AT&T Cuts Coffee for Employees

I don’t think this quite qualifies as news to trade on, but interesting anyway. I’m a contractor at the “new AT&T”. They are making big cuts anywhere they can to reduce expenses. AT&T (T) is not a volatile stock. It’s just steadily up month after month, for the past year. I’m not sure how much longer they can keep it up, but with cost cutting moves down to cutting off our coffee, tea and hot chocolate they seem to be serious about saving every penny they can. In addition to the very small cost cuts, the rumors are that those of us who are contractors need to find a new home this year. We’re an expensive bunch. Sad to say it, I think they are making the right decision in cutting contractors who have been around for years. Not that they should kick us all out of the door since some of us add value, but making us employees (since they seem to be using us for the long term) would save a good bit of money.

To trade on T, I think the best move to make is to sell a naked put ITM. 40 seems an easy strike that should be passed by June or even July with the trend that’s been going. Buying a call ITM or OTM might not be such a bad move either considering the relatively low volatility.