Olympic Peak’s Todd Westhus says AT&T bonds are overvalued.
AT&T “has a ton of debt,” he said on CNBC’s “Squawk Box” Wednesday. “This is a very mature business. Revenues have been declining.”
He recommends shorting the company’s bonds.
Shorting is a trading strategy that involves selling a borrowed asset with a view that it will drop in value and the asset can be bought back later and returned for a profit.
The investor said AT&T added $125 billion in additional debt to its balance sheet since 2007 in his presentation for the Sohn Tel Aviv conference held Wednesday. He noted the wireless business is facing more competition and has deteriorating growth trends.
Westhus is the founding partner and chief investment officer of Olympic Peak. Prior to this role, he worked at Perry Capital for 11 years where he was a managing partner.
Sohn is series of widely anticipated hedge fund conferences, where managers volunteer their time and best investment ideas to raise money in the fight against childhood cancer.
AT&T did not immediately respond to a request for comment.
