AT&T's stock plunged to its lowest level since 1985, dragged by weakness across the telecommunications and cable television sectors, and by investor displeasure with its proposed reverse stock split, a move never before pursued by a Dow industrials firm, analysts said.

Shares dropped 8% to lowest level in 17 years; down 34% in the last 10 months.

"AT&T's getting hit from all sides -- the cable guys are down, the telecoms have been down and they're going lower." ...

"Given the problems in the telecom sector with carriers with a lot of debt, and given the off-balance sheet issues at Adelphia, I think investors may be concerned about cable stocks that have high debt levels. And Comcast, after the merger with AT&T Broadband, will have a huge amount of debt."

Most of AT&T's stock price reflects the value of the cable television business, rather than its shrinking telephone operations. ...