Key Takeaways for AT&T Stock as of September 2026
- CEO John Stankey pushed 2026 buybacks up by as much as 25% to roughly $10 billion, framing the move as a direct response to what he called an undervalued stock.
- AT&T’s quarterly dividend has sat at $0.28 per share in every quarter TIKR tracked from September 2024 through June 2026, with no increase anywhere in that span.
- At 42.71%, AT&T’s payout ratio left room to spare against AT&T stock’s 4.29% yield.
- TIKR’s mid case model targets $41 for AT&T stock by the end of 2030, worth a 56% total return and an 11% annualized rate.
AT&T Stock’s Capital Return Math Now Favors Buybacks Over Dividend Growth
AT&T Inc. (T) used its second quarter 2026 call, held July 22, 2026, to make one thing clear: buybacks are getting the bigger share of the company’s cash. CEO John Stankey said AT&T would raise its 2026 repurchase plan by as much as 25%, to approximately $10 billion, up from a prior target of $8 billion.
He didn’t dress up the reason. Stankey said the increase was meant “to capture what we see as a disparity between our operating fundamentals and the valuation of our stock.”
CFO Pascal Desroches quantified just how much of AT&T’s cash that leaves for everything else. “Together, our planned share repurchases and expected dividend payments will total approximately $18 billion this year, which is essentially 100% of our outlook for free cash flow,” he told analysts.
That full year free cash flow outlook stands at $18 billion plus, against planned capital investment of $23 billion to $24 billion. Second quarter free cash flow came in at $4.7 billion, roughly $300 million higher than a year earlier and above the high end of AT&T’s own $4.0 billion to $4.5 billion guidance range.
Guidance embedded in that outlook assumes AT&T’s advanced connectivity business, the unit that drives nearly all of its earnings, keeps growing service revenue by 5% or more for the full year.
Second quarter service revenue grew 3% and adjusted EBITDA climbed 5%. The adjusted EBITDA margin rose 110 basis points to 39% in the process.
Desroches also flagged where the balance sheet stands. Net debt to adjusted EBITDA closed the quarter at 2.68x, a figure he said would climb to the 3.2x range once AT&T’s EchoStar spectrum deal closes, before returning to the 2.5x range within about three years.
Even so, Stankey stopped short of locking in the buyback path for good. Asked directly about capital allocation, he called it “a decision for the Board” and said the directors would spend time on the question at their September meeting, the same month as this data.
AT&T Stock’s Flat Dividend Rests on a Payout Ratio That Just Cooled Off
AT&T’s quarterly dividend has held at $0.28 per share for eight straight quarters, from September 2024 through June 2026, without a single increase.
That flat line makes the payout ratio the more interesting number. It swung to negative 1,171.26% in the September 2024 quarter before settling into a tighter band: 49.93%, 48.06%, 45.42%, 21.83%, 53.12%, 52.15%, and 42.71% most recently.
A payout ratio in the low 40s to low 50s range gives AT&T plenty of earnings cushion. That fits with Stankey’s decision to route extra cash toward buybacks instead of dividend increases.
AT&T stock’s forward yield closed at 4.29%, below its own trailing average of 5.16% and well off the 7.84% high in the data. That gap reflects a stock price that’s climbed relative to the flat payout, not a change in the dividend itself.
The next real test comes when AT&T’s Board wraps its September capital allocation review, the meeting Stankey pointed to when he called the repurchase increase a decision still in the directors’ hands.
TIKR’s $41 Target Gives AT&T Stock Room to Run Toward 2030
TIKR’s mid case valuation model puts AT&T stock’s target price at $41, realized by the end of 2030, for a 56% total return and an 11% annualized rate off a $26 current share price.
That kind of return profile puts AT&T stock among the stronger total-return stories in telecom right now, with the dividend layered on top of the price appreciation the model already assumes.
The model’s growth assumptions track closely to what management guided to on the July call: $18 billion-plus of full year free cash flow and a 39% EBITDA margin already achieved last quarter. Add the 5% or better growth target for advanced connectivity service revenue and John Stankey’s plan to lift 2026 buybacks toward $10 billion, and this target looks like one management is already working to hit.
Should You Invest in AT&T Inc.?
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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!
