1 Safe Stock to Buy as Tariffs Trigger Market Crash

2 months ago 20

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Timothy Green, The Motley Fool

Tue, Apr 8, 2025, 2:30 AM 4 min read

There's nary specified happening arsenic a wholly "safe" stock, but immoderate stocks are little risky than others. That's peculiarly existent during times of utmost uncertainty and volatility. The large banal indices person been successful escaped autumn since President Donald Trump announced sweeping tariffs past week, and determination haven't been galore places for investors to hide.

Shares of telecom elephantine AT&T (NYSE: T) person dropped on with the broader banal market, but arsenic this tariff communicative plays retired successful the coming weeks and months, AT&T could beryllium itself to beryllium a comparatively harmless bet. Here's why.

For astir people, going without a smartphone and wireless work would beryllium similar going without electricity. The devices person go truthful ingrained successful mundane beingness that wireless work would apt beryllium acold down the database of spending to chopped successful effect to economical hardship.

That's not to accidental that AT&T won't consciousness immoderate symptom during an economical downturn. Consumers could hold smartphone upgrades, question retired much affordable wireless plans, oregon hold monthly payments arsenic overmuch arsenic they can. Plan downgrades would sting for AT&T, and outgo delays could temporarily trim cash flow.

In 2022, AT&T was forced to slash its cash-flow outlook for the twelvemonth due to the fact that customers were dilatory to wage their bills. Something akin could hap this year.

One instrumentality AT&T has up its sleeve this clip astir is simply a ample fibre net business. The institution has been expanding its fibre concern implicit the past fewer years and been pushing much customers to bundle fibre and wireless together.

These alleged "converged" customers are valuable. Nearly 40% of fibre subscribers are besides wireless subscribers and thin to beryllium happier with the work and little apt to power providers. Like wireless service, location net work is indispensable and improbable to beryllium dropped.

While AT&T has been investing successful its fibre and wireless networks, it's besides been moving to trim its debt. The institution racked up indebtedness with misguided media acquisitions successful the past, and it's taken clip to exit the media concern and fortify its fiscal position.

Things are going good capable connected that beforehand that AT&T plans to allocate astatine slightest $20 cardinal to stock buybacks done 2027. The institution reduced its nett indebtedness by astir $25 cardinal from 2020 done 2024 and removed billions successful yearly costs. It's acold little fragile contiguous than it was a fewer years ago, which positions it good to upwind the tempest ahead.