If You Invested $1,000 In AT&T Stock One Year Ago, Here's How Much You'd Have Now

Investors who have owned stocks in the past year have generally experienced some big gains. In fact, the SPDR S&P 500 SPY total return over the past 12 months is 48.1%. But there is no question some big-name stocks performed better than others along the way.

AT&T’s Difficult Road: One company that has been a lackluster investment in the past year has been telecom giant AT&T Inc. T.

In recent years, AT&T has been investing heavily in non-core businesses in an attempt to grow its business. A $67 billion buyout of DirecTV in 2015 and an $85 billion buyout of WarnerMedia in 2016 left the company with a massive debt load.

In addition, AT&T pays out $3.7 billion in dividends on a quarterly basis, which hinders its ability to pay down that debt. At the same time, AT&T spent about $15.7 billion in capex in 2020, much of which went to building up its 5G network. AT&T spent $23 billion on Spectrum in early 2021, bringing its total debt to around $180 billion.

In 2019, AT&T generated $1.89 in EPS on $181.1 billion in revenue. In 2020, those numbers plummeted to a 75-cent EPS loss on just $171.7 billion in revenue.

At the beginning of 2020, AT&T shares were trading at $39.16. By the beginning of March, the stock had dropped to $36.37 after news of the virus spreading in China prompted concerns about a U.S. pandemic. On March 23, AT&T stock ultimately bottomed at $26.08. Fortunately, the stock rebounded somewhat from that point on as the broader market recovered.

By early June, AT&T shares were back above $33. But while the S&P 500 continued to rise in the second half of 2020, AT&T stalled out.

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AT&T In 2021, Beyond: By late October, AT&T was back to testing its March lows, ultimately bottoming at $26.35.

On Monday, AT&T opened at its highest level since before the pandemic, topping out at $33.88 before dropping back down to around $32.50. The jump came in response to the news that AT&T is merging WarnerMedia with DISCOVERY COMMUNICATIONS INC. DISCA in a $43 billion deal.

AT&T investors who bought one year ago and held on have generated an underwhelming return on their investment. In fact, $1,000 in AT&T stock bought on May 17, 2020, would be worth about $1,222 today, assuming reinvested dividends.

Looking ahead, analysts are expecting AT&T's stock to once again struggle in the next 12 months. The average price target among the 22 analysts covering the stock is $31, suggesting 4.8% downside from current levels.