Key Stats for AT&T Stock
- Price change for AT&T stock: -6%
- $T Stock Price as of Oct. 21: $22
- 52-Week High: $29
- $T Stock Price Target: $29
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What Happened?
AT&T (T) beat Wall Street estimates for the third quarter, but AT&T stock still fell more than 6% on Wednesday.
- Adjusted earnings came in at $0.65 per share, ahead of the $0.60 analysts expected.
- Revenue hit $32.32 billion against estimates of $31.65 billion.
The company also raised its 2026 adjusted EPS outlook to about $2.40, above the $2.34 analysts expected.
Management said most of the increase comes from lower depreciation tied to the planned sale of its Mexico wireless business.
Customer growth was strong given AT&T added more than 1 million Advanced Connectivity customers for the second quarter in a row. That includes fiber, fixed wireless, and postpaid phone customers.
Postpaid phone net adds were 379,000 and Advanced Connectivity revenue rose 6.1% to $23.9 billion.
Cash returns stayed steady. AT&T returned $4.8 billion to shareholders, including $2.8 billion in buybacks.
The annual dividend stays at $1.11 per share, while free cash flow was $5.0 billion.
AT&T also kept its free cash flow targets and expects at least $18 billion in 2026, $19 billion in 2027 and $21 billion in 2028.
Capital spending for 2026 is $23 billion to $24 billion, while for 2027 and 2028, it should be about $1 billion lower each year.
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What the Market Is Telling Us About AT&T Stock
The drop suggests investors found something to worry about beyond the beat.
One concern is fiber pricing, as fiber revenue per customer fell 4% from last year, and AT&T expects a similar decline in Q4. The company says it is offering lower introductory prices to win more customers.
AT&T expects higher marketing costs and about $100 million in vendor dispute settlements, which will weigh on adjusted EBITDA growth.
The quarter also included two big charges. One was a $2.6 billion noncash impairment tied to the Mexico sale. The other was a roughly $800 million employee separation charge.
Net debt to adjusted EBITDA rose to 3.13x after AT&T bought $23 billion of spectrum from EchoStar. The company wants to bring that back to about 2.5x during 2029.
For now, AT&T stock is caught between solid growth and short-term cost pressure. This was also the last quarter for CFO Pascal Desroches. Jennifer Biry steps into the role after the new year.
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So what is AT&T stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
