Re: Long-Term AT&T Investors

[Welcome back, PAT!]

> We've all heard that AT&T was once (perhaps still is) the most > widely-held stock in the United States. Most of us probably know > someone who bought AT&T stock long before the breakup and then never > touched it.

I am one of them.

Every so often you'd hear reports about how good an > investment this turned out to be. I was curious to see if I could > replicate this myself, following the history of Mother and her babies > from 1970 to the present day. > My results suggest a somewhat different picture. Adjusting for > inflation, that investment would today be worth today about what you > paid for it in 1970. I suspect this is because most such analyses > assume reinvestment of dividends, whereas I assume the contrary. (I > had to make this assumption in order to finish this project in a > single evening.)

But the reinvestment of dividends is what made the investment so good.

You can find my analysis at .

I purchased 100 shares of AT&T in 1962. Other than cashing a few very small checks sent to me because of mergers or spinoffs for partial shares, I have not touched the account. Until 2001 all dividends were automatically reinvested, after 2001 dividends have been sent to me in cash otherwise the total value would be higher.

As of Friday, 3/3/2006 the value of the shares (of the remaining companies, ACR, T, BLS, CMCSA, LU. Q, VZ & VOD) was $118,188.12.

Actual figures, no analysis involved -- all from 100 shares of AT&T.


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Have you done your backup today?

Reply to
Ernie Klein
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