AT&T vs Netflix Which Is More Favorable?

AT&T and Netflix are two major players in the world of entertainment and technology, each offering unique opportunities for investors. AT&T, a telecom giant, has recently made headlines with its acquisition of Time Warner and the launch of its streaming service, HBO Max. Meanwhile, Netflix remains a dominant force in the streaming industry, with a vast library of original content and a growing international presence. Both companies face challenges and opportunities in the competitive market, making their stocks of interest to investors seeking exposure to the rapidly evolving digital entertainment landscape.

AT&T or Netflix?

When comparing AT&T and Netflix, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between AT&T and Netflix.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. AT&T has a dividend yield of 4.72%, while Netflix has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. AT&T reports a 5-year dividend growth of -11.11% year and a payout ratio of 90.45%. On the other hand, Netflix reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with AT&T P/E ratio at 18.70 and Netflix's P/E ratio at 50.27. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. AT&T P/B ratio is 1.65 while Netflix's P/B ratio is 17.21.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, AT&T has seen a 5-year revenue growth of -0.32%, while Netflix's is 1.11%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with AT&T's ROE at 8.72% and Netflix's ROE at 35.86%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $23.11 for AT&T and $909.60 for Netflix. Over the past year, AT&T's prices ranged from $15.94 to $24.03, with a yearly change of 50.75%. Netflix's prices fluctuated between $459.20 and $935.27, with a yearly change of 103.67%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.