We recently compiled a list of 7 Cheap Rising Stocks to Invest In. In this article we will look at where AT&T Inc. (NYSE:T) ranks among the cheap rising stocks.

The recent Fed rate cuts have been a major catalyst for the market, and have provided an additional boost to an already strong performance. The market started the day with another all-time high on September 26 and it seems like the cuts have been positively influencing market sentiment and activity.

Nevertheless, some experts are still saying that investors are moving with caution as the timeline moves closer to the US elections. Wisdomtree CEO, Jonathan Steinberg recently joined CNBC “Money Movers” as he discussed the impact of the Fed’s actions on market flows and noted that while the 50-basis-point rate cut may reduce recession risks, a significant amount of money remains on the sidelines.

Steinberg explained that many investors are cautious, keeping money in safe places like money market funds, due to uncertainty about the upcoming election and its potential impact on the economy. The differing policies of the candidates make it hard to predict market trends, so people are waiting to see the election results before making big investment decisions.

Expert Opinions on the Election

As the elections move closer, the sentiment has been quite mixed around the candidates as it seems like a very close one. While many have a solid opinion on their favorite candidates, economists and market experts might not be feeling the same.

In our article 7 Best Revenue Growth Stocks to Buy According to Analysts, we discussed Professor Jeremy Siegel’s opinions on the Fed cuts and upcoming elections. Here is an excerpt from the article:

“In a discussion about economic policies from the presidential candidates, Professor Siegel critiqued both sides as extreme and said that their policies are unlikely to be implemented. He said that there would be a divided government that would limit any drastic changes. He stressed that while some policies might be proposed, actual governance would lead to compromises rather than sweeping reforms.”

While Professor Siegel remained neutral and criticized both sides, Harvard professor and former Chairman of the Council of Economic Advisers, Jason Furman seems to be leaning more toward the Democratic Party. However, he too criticized the economic plans of both candidates on September 20 in an interview on CNBC’s Squawk Box.

Insights from Jason Furman on Fed Policy

In the discussion about the Fed’s rate cut policy, Furman noted that while he would have preferred a smaller 25-point cut, he does not believe the Fed has inside knowledge of serious economic risks.

He thinks the move only shows caution over rising unemployment. About the unemployment situation, he said that he is, “a little bit nervous about it too, just not quite as nervous as 50 basis points.”

Furman acknowledged that inflation has come down but pointed out that risks such as potential wage-driven inflation and the possibility of a recession are still there. He appreciated the Fed’s gradual approach, which allows for adjustments in future rate decisions if needed.

Our Methodology

For this article, we used stock screeners to identify over 30 stocks with more than 10% share price gain over the last month and a forward price-to-earnings ratio of less than 15 as of September 27. We narrowed our list to 7 stocks most widely held by institutional investors. The 7 cheap rising stocks are listed in ascending order of their hedge fund sentiment which was taken from Insider Monkey’s database of over 900 elite hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

AT&T Inc. (NYSE:T)

FWD PE Ratio: 10.02

1-Month Stock Price Performance: 10.83%

Number of Hedge Fund Holders: 71

A cheap rising stock to invest in, AT&T Inc. (NYSE:T) is a leading global provider of telecommunications and technology services, operating through two primary segments, Communications and Latin America.

The Communications segment offers a wide range of wireless voice and data services, along with selling devices such as handsets and wireless data cards. The segment also includes offerings like Virtual Private Networks, AT&T Dedicated Internet, and Ethernet services. Moreover, it provides broadband solutions, fiber connections, and more. The various products and services under this segment are marketed using well-known brands such as AT&T, AT&T Business, Cricket, AT&T PREPAID, and AT&T Fiber.

AT&T’s (NYSE:T) Latin America segment extends its reach by offering both postpaid and prepaid wireless services in Mexico through the AT&T and Unefon brands, along with the sale of smartphones via owned stores, agents, and third-party retailers. The geographical diversity allows it to capture a broader customer base and respond to regional demands effectively.

Bloomberg reported recently that its DirecTV has been involved in advanced negotiations to merge with Dish, according to people familiar with the matter. Such a move, if it happens, would create the largest pay-TV provider in the United States, combining nearly 20 million subscribers.

The industry is grappling with challenges, including a decline in traditional pay-TV subscriptions. While previous discussions regarding a DirecTV-Dish merger faced regulatory hurdles, the evolving landscape, marked by a significant shift towards streaming services, may ease these concerns this time around.

Such a merger would improve the competitive position of the combined entity and improve its ability to compete against cable operators and major streaming platforms. Lastly, according to the people familiar with the matter, DirecTV is negotiating to take charge of the merged entity, which will operate as a private company.

Overall T ranks 5th on our list of the cheap rising stocks to invest in. While we acknowledge the potential of T as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than T but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.

Disclosure. None. This article was originally published on Insider Monkey.