Analysts weigh in on expected AT&T Q1 2009 results

AT&T is expected to report steady results for the first quarter of 2009 on Wednesday, but the announcement may be overshadowed by pension liabilities and the ever-shrinking base of wireline subscribers.

Investors seem to be more excited about Sprint, a company who has seen its shares double in value since the beginning of the year.  Verizon's stock price is also doing better.

Wireless sales are likely to receive scrutiny. While AT&T has exclusive rights to the iPhone in the U.S., sales for the device are likely to be down from the fourth quarter, and a refreshed handset to stimulate sales isn't expected to be on the scene until the summer. Wireless subscribers are also moving to cheaper prepaid plans, with such contracts attracting more customers than traditional contract-based post-paid plans.

Analysts believe the company will earn around 48 cents per share in Q1 excluding items on $31.3 billion in revenue, add between 712,000 to 800,000 net-new wireless customers, and announce the loss of 1 million or so landlines.

S&P is not happy with AT&T's long-term outlook, rating its debt to "negative" from stable a month ago. The ratings service cites declines in the value of AT&T's pension fund and spectrum purchases for wireless leaving little room for additional borrowing.

For more:
- AP weighs in on what AT&T might say in its Q1 2009 earnings statement. Post.

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