Key Takeaways
- AT&T shares closed [25%] below their March high on Oct. 21, and Bank of America still sees them reaching $34, [55%] above that close.
- The stock fell after a third-quarter report with 20% adjusted EPS growth and a raised 2026 outlook, with SpaceX’s Starlink push into mobile hanging over the carriers.
- Analysts expect normalized EPS to climb from $2.12 in 2025 to $2.92 in 2028, and the stock trades a little below its 5-year average forward P/E.
- BofA’s target works out to about 14x forward earnings, close to the stock’s 5-year high, so the call is plausible but stretched.
AT&T (T) just posted its best service revenue growth in more than four years and raised its 2026 earnings outlook. The stock sank anyway, closing at $21.91 yesterday, 25% below its March 27 closing high of $29.10.
On Oct. 22, Bank of America analyst Michael Funk reiterated his Buy rating and $34 price target, 55% above that close.
Strong quarter, sour reaction
SpaceX (SPCX) hung over the report, as investors weigh what a Starlink push into mobile could mean for carriers.
Revenue rose 5.3% to $32.3 billion, adjusted EPS climbed to $0.65 from $0.54, and management now expects about $2.40 for 2026, up from $2.25 to $2.35.
But investors zeroed in on slower postpaid phone growth and a 4% drop in fiber ARPU.
BofA is sticking with $34
Funk’s case rests on convergence, AT&T’s push to sell customers wireless and fiber together. Ahead of the report, he noted that “AT&T remains disciplined in wireless despite ongoing competitive intensity around the iPhone launch.”
TIKR tracks 25 analysts on AT&T. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on AT&T, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See AT&T’s Analyst Ratings
Does $34 add up?
The average price target has slipped from $31 a year ago to $29, with targets running from $20 to $36…
Earnings estimates are moving the other way. Analysts expect normalized EPS to climb from $2.12 in 2025 to $2.38 this year and $2.92 in 2028…
And with 2026 guidance now at about $2.40, this quarter gives analysts more reason to raise estimates than cut them.
The stock trades at 8.7x forward earnings, a bit below its 5-year average of 9.1x…
Funk’s $34 works out to about 14x the $2.51 a share analysts expect over the next twelve months, right around the stock’s 5-year high, set in September 2025.
Plausible, but it needs a re-rating
The risks are a real SpaceX move into mobile, and debt: net debt hit 3.13x adjusted EBITDA after the $23 billion EchoStar spectrum deal.
My take: AT&T is cheap and earnings are heading the right way, but $34 within a year needs the stock’s peak multiple of the past five years.
The next test is the fourth-quarter report early next year, when AT&T says it will lay out what supports $19 billion-plus of free cash flow in 2027. If that holds up, $34 gets a lot easier to reach.
So what is AT&T stock actually worth?
TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR’s valuation model and see what AT&T could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It’s free to use.
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 of the stocks mentioned. Thank you for reading, and happy investing!
