In a report published Wednesday, Jefferies added shares of AT&T to its so-called Franchise Pick List because of the telecom company's 5.5 percent dividend yield that the analyst says is safe.
"We believe investors will be rewarded for investment in AT&T shares," wrote Jefferies' analyst Mike McCormack, who predicts the stock could reach $40 by the end of the year, a 16 percent move from where it trades.