Summary
- Stock markets continue to battle with small bouts of extreme volatility, and investors might be re-positioning their portfolios in a context of rising economic uncertainty.
- Another surge in COVID-19 cases and the prospect of a contested election in the United States are being seen in conjunction with analyst commentaries which suggest it’s time to sell AT&T.
- However, we think it's the wrong time for income investors to make hasty decisions to panic-sell stocks like AT&T while they trade near their lows.
- For these reasons, we believe that income investors should stay the course and even consider adding to long positions while AT&T continues to trade near the lower boundary of its multi-decade range.
Stock markets continue to battle with small bouts of extreme volatility, and it appears that a growing number of investors might be re-positioning their portfolios in a context of rising economic uncertainty that includes another surge in COVID-19 cases and the prospect of a contested election in the United States. However, we must argue that this is the wrong time for income investors to make hasty decisions to panic-sell certain stocks near their lows.
As a case in point, we believe that AT&T (T) works as a perfect example of this phenomenon as a stock that should be held rather than sold based on broader uncertainties in the market. For these reasons, we believe that income investors should stay the course, avoid selling the stock during a potentially turbulent trading period, and consider adding to long positions while AT&T continues to trade near the lower boundary of its multi-decade range.
Intelligent income investors understand that it is important to assess the potential risks associated with any portfolio investment. When we are looking at various analyst notes arguing “for” or “against” the benefits of long positions in AT&T stock, one of the commentaries that stands out the most can be found in the recent research note by KeyBanc.
