Which Telecom Stocks Have the Strongest Earnings Trends: Verizon, AT&T, MetroPCS, or Sprint?

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 5 telecom stocks rank via earnings trends:

AT&T, Inc. (NYSE:T): Current Price $35.51

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 123,440 122,510 124,280 126,720 127,430
Diluted EPS ($) -0.44 2.05 3.35 0.66 1.25

We see that revenue has been picking up over the past three years for this telecom giant, and profits also moved up sharply between 2008 and 2010. Profitability, however, took a dive in 2011.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 32,500 31,820 31,580 31,460 32,580
Diluted EPS ($) -1.12 0.60 0.66 0.63 -0.68

Revenue fell every quarter after December 2011 until last quarter. EPS is down three quarters in a row, failing our analysis. We could do better elsewhere…

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