THE BUSINESSWEEK 50 RANKINGS + 25

48

AT&T

Rapid-fire acquisitions have created the nation’s largest telecom. Three deals profoundly changed the grown-up Baby Bell, formerly SBC Communications. In 2004, SBC led a deal to combine AT&T Wireless with Cingular, its joint venture with BellSouth. The following year, SBC changed its name to AT&T after acquiring that fabled telecom. And in December, CEO Ed Whitacre closed a merger with BellSouth. AT&T’s assets now include the nation’s largest wireless network. Whitacre pursues mergers that promise huge synergies—$8 billion in annual cost savings over the next three years—and aims to pump that money into innovation. The behemoth now is ramping up a $5 billion fiber network complete with TV service.

Overall Grade

A- ***

Market Data

T

Market Value
(2/28/2007)

$229.6 Billion

Profitability*

10.1%

C

Sales Growth Rate**

15.0%

B+

12-Month Sales

$63.1 Billion

12-Month Net Income

$7.4 Billion

Total Return Past 12 Months

39.2%

Past 36 Months

77.3%

Economic SectorTelecommunication Services
IndustryIntegrated Telecommunication Services
The overall sector letter grade reflects how the weighted average of the return on income, or return on equity, and sales growth grades compare with others in the same sector. For the overall grade as well as the ROE/ROI and sales growth grades, an "A" places a company in the top 7% of its sector and an "A-" in the top 14% of the sector. The actual ranking was done using the underlying numerical measures. Grades are for information only.
* For nonfinancial companies, three-year average pretax operating profit before interest and special items as a percentage of average invested capital. For financial companies, pretax profits as a percentage of average shareholder's equity.
*Three-year average annual sales growth based on the most recently reported 36 months, calculated using the least-squares method.
***Grade adjusted for small size of sector.

Edward E. Whitacre

Edward E. Whitacre, 65

CEO since 1990


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Data as of 2/28/07 provided by Standard & Poor's Compustat