Each of the stocks we track were up this week as the market finishes the second quarter with momentum. For the first time since early February, the Fab Five are actually up for the year. As shown in the table above, three of the Fab Five gained enough value to make up for Google and Apple’s losses. To say these stocks have moved in lockstep this year is clearly false – contextual data (the source of strong LLMs) is in, while less-intelligent hardware isn’t in vogue.
The story on the Telco Top Five is a bit different. Wireless is clearly in, specifically the use of fixed wireless as a capacity filler. But broadband is also in, with Charter up 17% so far this year (yielding, before dividends are included, the same return as Microsoft).
Investors received some confidence this week when T-Mobile CEO Mike Sievert told Yahoo! News that the report published in a German newspaper was incorrect (full interview here). That drove the stock price back to the $230s. TMUS lost $28 billion in value from June 6 to June 20, then recovered $16 billion over the last week with the only other big news headline centering on T-Satellite (more details in their YouTube all company meeting here). Safely said, Mike Sievert is a $10 billion man, maybe even the sixteen-billion- dollar man (a reference to Steve Majors for those of you under the age of 50 – link here).
One final note: When AT&T surpassed Verizon in market capitalization earlier this year, several of you commented “it’s not materially different.” We pressed several of you on what level would constitute material, and consensus was a consistent 15% difference. As of Friday’s close, that difference has grown to 13-14%. We pulled the one-year chart shown nearby to see when the change likely occurred (the chart shows similar movements on a day-to-day basis) and can pinpoint it to earnings calls as well as the Verizon Best Value Guarantee introduction in early April. We may be totally wrong, but our assumption is that this gap only widens as investors conclude that Verizon may have overpaid for Frontier (which is still heavily copper, despite many incorrect analyst reports to the contrary), and that prepaid takes a lot of time and attention away from postpaid.
File is below. Comments welcome as always. Note: We will be converting our legacy email subscribers to the WordPress system over the Fourth of July weekend. The next full Brief will be July 20th.
