Key Takeaways
- Elon Musk said SpaceX “could just acquire” a legacy telco to use its spectrum, after Verizon, AT&T and T-Mobile reportedly turned down SpaceX’s requests to run on their networks.
- Musk’s comment shows that the spectrum AT&T and Verizon own is the asset SpaceX wants. For shareholders, that matters more than the odds of an actual bid.
- A buyer would take on AT&T’s debt of about $160 billion and would have to pay for Verizon’s $20.1 billion of fiscal 2025 free cash flow. Any deal would also face FCC and antitrust review.
- AT&T trades at 8.8x forward earnings, below its five-year average of 9.1x. The next thing to watch is the FCC’s review of SpaceX’s own spectrum purchase.
SpaceX (SPCX) wants to be a phone company, and the big carriers aren’t helping. Verizon (VZ), AT&T (T) and T-Mobile have reportedly all turned down Elon Musk’s requests to let SpaceX’s mobile service run on their networks.
So Musk has floated another way in. A clip of him talking about Starlink and the telcos was played on this week’s episode of Moonshots with Peter Diamandis. In it, he said:
“I think SpaceX will be able to get very far with the spectrum that it’s acquired. But, you know, at a certain point, if we’re able to make much better use of the spectrum than, say, a legacy telco is, we could just acquire that legacy telco and use the spectrum, you know, 10 times more effectively.”
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Dave Blundin, founder of Link Ventures and a regular on the show, went further: “We’re going to have Starlink phones, we’re going to have Starlink services, and it will decimate terrestrial.”
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SpaceX keeps buying its way in
SpaceX has been paying up for spectrum. It spent $17 billion on spectrum from EchoStar, a deal the FCC approved in May. On Nov. 10, the FCC accepted SpaceX’s filing to buy 800 MHz licenses from Grain Management. The Wall Street Journal reported that deal could cost about $8 billion.
The carriers have pushed back each time. Through CTIA, their trade group, they warned the FCC that a wider spectrum buildout could hurt consumers who count on ever-growing wireless capacity. And Semafor reported that AT&T and T-Mobile would cut Boost Mobile off their spectrum if SpaceX goes ahead with a Boost takeover.
That’s why Musk’s comment matters for AT&T and Verizon shareholders. SpaceX already looked like a new competitor AT&T owners had reason to worry about. Now Musk has said out loud that a carrier could be the target, since the carriers hold the spectrum he wants.
AT&T is cheap, and it carries plenty of debt
If investors thought a bid was coming, AT&T’s valuation would show it. It doesn’t. AT&T trades at 8.8x forward earnings, a bit below its five-year average of 9.1x and well under the 14x it reached in September 2025:
A buyer would get more than the spectrum, though. It would also take on AT&T’s debt, which stood at about $160 billion at the end of fiscal 2025, up from $144 billion a year earlier:
That was before this year’s deals. In 2026, AT&T spent $28.4 billion on EchoStar spectrum and Lumen’s fiber business. That pushed its net debt to 3.1x adjusted EBITDA at Sept. 30, up from 2.5x at the end of 2025.
Verizon wouldn’t be any easier to buy. It turned its spectrum and network into $20.1 billion of free cash flow in fiscal 2025, up from $14.1 billion in fiscal 2022, and a buyer would have to pay for that cash:
A bid would have to get past Washington
Musk hedged his own words: “at a certain point,” and only “if” SpaceX can make much better use of the spectrum. A SpaceX deal for a national carrier would face FCC and antitrust review. SpaceX’s own spectrum plans still need approval too: the FCC will take public comments on the Grain purchase in December.
Blundin’s “decimate” call is also ahead of the numbers. AT&T’s postpaid phone churn was 0.92% in the third quarter of 2026, the same as a year earlier. And Qualcomm CEO Cristiano Amon said on Qualcomm’s fiscal fourth-quarter call that deployment of SpaceX’s own ground network begins in 2027.
The carriers hold the scarce asset
So AT&T and Verizon do own what Musk wants, and he’s said as much. I wouldn’t buy either stock hoping for a SpaceX bid. It’s only a “could,” a buyer would take on a pile of debt, and Washington would get a say.
But the comment does tell us something about what the carriers’ spectrum is worth: enough that Musk would consider buying a whole telco to get it. At 8.8x forward earnings, below its own five-year average, AT&T is priced as if SpaceX only takes its customers. That price gives it little credit for what its spectrum is worth to a buyer.
Of course, December’s comment period on the Grain deal and AT&T’s fourth-quarter report, expected in late January, will show us more. They’ll show whether SpaceX can build what it wants without buying anyone, and whether AT&T’s customers are staying put.
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 of the stocks mentioned. Thank you for reading, and happy investing!
