Make no mistake—many telecommunications companies are already in distress from a credit perspective. Andrew Freedman says an industry that’s “become uninvestable for a lot of people” would face additional headwinds if Amazon’s interest in mobile services comes to fruition.
“If all of a sudden you introduce a fourth player into the marketplace where growth is already slowing, and it’s already very competitive, and you have very strong consumer brand that can just bundle with an existing service, that is a really big problem,” explains Hedgeye’s Communications analyst in this clip from The Macro Show.
“It doesn’t seem like it’s happening, but it could result in share loss, and more competition, which would probably mean AT&T would have to invest more just to grow the business, which would mean they’d have to reduce the dividend,” Freedman adds.
Watch the full clip above.
