AT&T Fuels Investors' Dream for BBB Bonds

The video discusses AT&T's strategy to manage its $171 billion debt by selling $5 billion in bonds to refinance near-term maturities. Despite the large debt, AT&T is unlikely to issue more debt this year, opting to use cash for obligations. The current credit market conditions are favorable, with lower spreads for triple B rated bonds, which is AT&T's rating. A deleveraging trend is observed across the corporate sector, termed the 'great debt diet.' This environment has led to strong performance for triple B bonds, outperforming the broader investment grade market. Companies are using this period of low borrowing costs to improve their balance sheets.

What is AT&T's primary strategy to manage its debt load?

• Acquiring new companies

• Increasing dividend payouts

• Selling bonds to refinance

• Issuing new equity

Why might AT&T choose to use cash instead of selling more debt this year?

• To expand its workforce

• Due to favorable credit market conditions

• To invest in new technology

• To increase its market share

What is the term used to describe the current trend of reducing corporate debt?

• Deleveraging wave

• Credit tightening

• Debt expansion

• Financial inflation

What was the concern for triple B bondholders at the end of last year?

• Lower dividend yields

• Increased competition

• Rising interest rates

• A wave of downgrades

How has triple B rated debt performed compared to the broader investment grade bond market this year?

• It has not changed

• It has underperformed

• It has performed equally

• It has outperformed