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Actionable news in T: AT&T Inc,

Time To Sell T-Mobile

The telecom sector is deeply overbought here.

A large portion of the appeal of the industry is the high dividend paid out by AT&T and Verizon.

The article below will discuss my sell thesis on T-Mobile.

The telecom sector continues to outperform the overall market as investors embrace what can be termed as risk off assets. The two largest entities in the space Verizon (NYSE:VZ) and AT&T (NYSE:T) are highly prized for their above-average dividend, especially in today's yield starved marketplace. I have decided to sell my stake in T-Mobile (NASDAQ:TMUS) as will be outlined below.

Fierce Rally

The market continues its strong run after the initial shock of Brexit. The fierce rally has pushed the SPY past prior resistance to a new all-time high. Barring a sudden sell-off, the index should mark a new all-time weekly high extinguishing a significant portion of the bears' thesis.

The bears are not vanquished; they remain firmly in hibernation waiting for their chance to take the market down. With earnings season upon us, I suspect they will be given the opportunity to wreak havoc on individual names. Notice the RSI shown above; the index is closing in on the 70 number indicating the market is overbought here. It is often wise to avoid purchasing equities when the market is overbought; typically, a better opportunity will reveal itself.

Telecom

The telecom sector remains a defensive industry with muted growth prospects. The largest players in the industry, T and VZ, return a significant portion of their free cash flow to investors via a quarterly dividend. The industry requires a consistent outlay of Capex to upgrade and...


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