HBO, Game of Thrones and the AT&T Stock Price

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There’s no shortage of worries when it comes to AT&T (NYSE:T). The T stock price hasn’t moved in years. In fact, shares touched a seven-year low in December, and trade below where they did at the beginning of 1998. AT&T is the most indebted company in the world. Growth remains meager.

T stock above $30 isn't justified
T stock above $30 isn't justified

Indeed, I’ve been a longtime skeptic toward T stock. I argued as recently as last month that shares should sit below $30. From a broad standpoint, the concern is that AT&T simply isn’t winning.

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In Mobility, the company is losing market share to Verizon Communications (NYSE:VZ) and T-Mobile (NASDAQ:TMUS). The Time Warner acquisition remains reliant on the Turner networks — likely victims of cord-cutting. DirecTV is hemorrhaging subscribers. The streaming service is late to market, and seems to have little chance of dislocating Netflix (NASDAQ:NFLX) and Hulu, let alone the coming offering from Disney (NYSE:DIS).

A little over two weeks after the finale of HBO’s Game of Thrones, some investors have added that network to the list of worries. Will subscribers abandon the network, which potentially is AT&T’s most attractive asset? Did poor reviews for the finale undercut future opportunities for the franchise?

They are interesting questions from a business standpoint. But in fact, Game of Thrones — and even HBO — aren’t necessarily that material to the AT&T stock price. That’s good news, but it’s also part of the problem.

Game of Thrones and T Stock

Viewers did not enjoy the GoT finale, or even the last season. As Vox pointed out, the finale has far and away the lowest rating on IMDB of any episode in the series. A petition at Change.org to remake the final season “with competent writers” has received 1.6 million signatories.

Game of Thrones hasn’t yet really moved T stock. Indeed, despite initial backlash to the ending, shares actually increased modestly the next day. But that hasn’t stopped market participants from voicing concern about the franchise, and its impact on HBO.

Most notably, without GoT, HBO doesn’t have a headline blockbuster series with which to attract subscribers. The finale itself set a record as the most-watched HBO show ever. That’s a truly impressive accomplishment in a time of increasing audience fragmentation. No doubt some of the 19 million viewers are subscribers who are now at risk of canceling.