The Mother of All Blue Chips

08/12/2016 7:00 am EST


Nicholas Vardy

Editor, Bull Market Alert, The Alpha Investor Letter, and The Global Guru

In his specialized data-driven trading service, Alpha Algorithm, editor Nicholas Vardy assesses stocks based on 20 time-tested investment strategies. Here, he looks at "Ma Bell".

Our latest screen revisits a previous blue-chip recommendation, AT&T (T). Last time, we booked an 11.26% gain after it hit its stop price on a market pullback.

And it has only gotten more popular among the Alpha strategies since then. Here are the eight top investment strategies that are betting on AT&T:

1. High Quality Stock

The stock exhibits positive fundamentals, including high return on equity, stable year-over-year earnings growth and low financial leverage.

2. Momentum Factor

The stock also is one of the top 120 large- and mid-cap US stocks exhibiting relatively higher price momentum, as measured by a specific factor which has historically driven a significant part of companies’ risk and return.

3. Fundamental Strength

It is a top US stock based on fundamentals measured by book value, cash flow and sales dividends.

4. Dividend Aristocrat

The stock is among those in the S&P 500 that have increased dividends for at least 25 consecutive years.

5. Dividend Dog

It is one of the five highest-yielding stocks among each of the 10 sectors tracked in the S&P 500.

6. High and Steady Dividend

The stock is one of 50 dividend-paying companies from the S&P 1,500 Composite Index that has increased dividends for at least 20 consecutive years.

7. Small-Cap/Value Tilt

Selected using a multi-factor modeling approach, the stock is a smaller-cap or value stock designed to enhance portfolio risk/return characteristics.

8. Large-Cap Growth and Value

Using a proprietary ranking based on separate models for growth and value, this is a large-cap stock that is part of an index that has historically outperformed its market-cap weighted benchmark.

Our recommendation is to buy AT&T at market and place an initial stop at $34.

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