![]() MoffettNathanson’s Moffett said those two giants could see the most dollar exposure but may better absorb the shock. Louthan went on to say: “Given this was within existing environmental regulations and risk of increased contamination is low, it is reasonable that the cost will be spread out over 10-plus years, minimizing the risks to the carriers.” “We can’t begin to know how long this will take to get resolved, but it could be measured in decades, with other Environmental Protection Agency actions like the Lead Copper Rule as a potential guide,” he said. Meanwhile, at Raymond James, analyst Frank Louthan said uncertainty for telecom stocks will linger. Or, the number of cables limited to very few.” On the bull side, the level of contamination could be overstated. Also, plenty of political squabbling with potential class action lawsuits and attorney general lawsuits. “We very much expect a long, drawn-out process, self-auditing. “The range of outcomes could range from near-zero liability to billions of dollars in damages,” he said. Meanwhile, Citigroup also downgraded AT&T Monday to neutral from buy due to the lead-sheathing issue.Īt TD Cowen, analyst Gregory Williams said: “We see a considerable overhang for the foreseeable future.” Williams went on to say telecom stocks will be better off if pro-business Republicans are elected in the 2024 election. ![]() They will likely need to take steps to make areas environmentally safe.Īs a result, JP Morgan downgraded AT&T on Friday to a neutral rating amid concerns. Last week, The Wall Street Journal reported telecom companies installed potentially dangerous lead-covered cables overhead on poles, in soil, and underwater. FYBR stock fell 2.2% to 13.99.” Lead-Sheathing Issue Could Last Decades “On the stock market today, T stock dipped 1.7% to 14.25. Telecom stocks could be in the doghouse for a while, even if they offer attractive dividends. ![]() “We could see what amounts to a general telecom buyer’s strike for some time,” SVB MoffettNathanson analyst Craig Moffett said. ![]() Making areas safer could cost tens of billions of dollars, analysts say. Most of the lead-sheathed cables were installed in phone networks before the 1960s. These companies have already lost a combined $18 billion in market value last week. The sell-off in telecom stocks spurred by reports of lead-sheathed cables installed in phone networks likely will continue to pressure shares in AT&T, Verizon Communications, Lumen Technologies, and Frontier. ![]()
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