AT&T Inc. (T) Dips On Contract Changes

AT&T Inc. (NYSE:T) may do away with two-year contracts

by Josh Selway

Published on Dec 31, 2015 at 1:10 PM

AT&T Inc. (NYSE:T) certainly hasn't lit up the charts this year, but the wireless provider has shown some strength recently. Since touching a three-year low of $30.97 in late August, the shares have picked up almost 12%, hitting a series of higher highs and lows. What's more, after going four months without closing atop the trendline, T is now set to settle above its 50-month moving average -- and in positive territory for 2015. 

Today, though, shares of the wireless stock are 0.4% lower at $34.59, amid broad-market headwinds and reports claiming the firm will be doing away with two-year phone contracts come Jan. 8. If this is true, customers will need to pay for new phones in their entirety up front, or choose an installment plan. 

Taking a look at the sentiment side of T, near-term options traders have taken a seemingly bearish stance. For instance, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.14 indicates put open interest is heavier than call open interest, at least among options set to expire within three months. More telling, this reading is higher than 84% of all others from the previous 12 months, meaning short-term option traders are more put-skewed than normal. 

Outside the option pits, bears have been hitting the exits amid T's rebound. Specifically, short interest fell by almost 11% over the two most recent reporting periods. 

Elsewhere on the Street, plenty of analysts have shown faith in AT&T Inc. (NYSE:T). Thirteen of the 21 firms covering the shares say they're at least a "buy," while zero deem them a "sell."

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