AT&T: Starlink IPO Risk

Noah's Arc Capital Management5.1K FollowersFollow5ShareSavePlay(12min)Comments(24)SummaryAT&T faces existential disruption risk from SpaceX’s Starlink, which is shifting telecom infrastructure from Earth-based to satellite-based networks.Starlink’s upcoming IPO will provide capital to aggressively target both broadband and cellular markets, threatening T’s core revenue streams and legacy infrastructure.T’s high debt load ($126B), heavy legacy capex, and a 19.77% dividend payout ratio leave it vulnerable to competitive and technological shifts.I believe T is a strong sell, expecting downside as Starlink’s expansion pressures earnings, dividend stability, and asset valuations.Tarcisio Schnaider/iStock Editorial via Getty Images Investment Thesis Later this year, Elon Musk's company (SpaceX) is set to IPO with the company hiring a handful of banks on Wall Street to help run its S-1 offering. Their key division, Starlink, has been aThis article was written byNoah's Arc Capital Management5.1K FollowersFollowThis account is managed by Noah's Arc Capital Management. Our goal is provide Wall Street level insights to main street investors. Our research focus is mainly on 20th century stocks (old economy) undergoing a 21st century transformation, but occasionally we'll write on companies that help transform 20th century firms as well. We look for innovations in a business model that will cause a stock to change dramatically.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Noah Cox (main account author) is the managing partner of Noah’s Arc Capital Management. His views in this article are not necessarily reflective of the firms. Nothing contained in this note is intended as investment advice. It is solely for informational purposes. Invest at your own risk.Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.