Key Highlights
- J.P. Morgan maintains AT&T on its top picks roster, highlighting fiber and 5G infrastructure investments plus cost competitiveness
- First-quarter results showed $0.57 EPS versus $0.55 consensus, with revenue reaching $31.51 billion
- Convergence rate climbed to 45% of fiber internet subscribers bundling wireless service, gaining 3 points year-over-year
- Analyst Sebastiano Petti increased 2026 EBITDA projection to $48.1 billion while maintaining $33 target price
- Year-to-date performance shows approximately 5% gain; current dividend yield stands around 4.2%
AT&T (T) stock began Monday trading at $26.15, reflecting a roughly 5% gain for the year through the previous Friday session. The telecommunications giant has moved largely in step with the S&P 500, which posted a 5.8% increase during the same timeframe.
J.P. Morgan analyst Sebastiano Petti reaffirmed AT&T’s position on the firm’s top picks roster Monday, emphasizing the telecom provider’s extensive fiber and 5G infrastructure development alongside favorable cost positioning compared to T-Mobile and Verizon.
“We believe AT&T’s asset mix, strengthened by years of investment in fiber and 5G, and its marginal cost relative to competitors, positions the company well to drive share gains,” Petti stated in his research note.
AT&T released first-quarter financial results on April 22nd. The telecommunications company delivered earnings per share of $0.57, surpassing the Street consensus of $0.55. Total revenue reached $31.51 billion, exceeding the $31.29 billion forecast and marking a 2.9% increase from the prior-year period.
Looking ahead to full-year 2026, AT&T provided EPS guidance ranging from $2.25 to $2.35. Wall Street analysts currently expect $2.31 for the period.
Petti highlighted a particularly compelling metric: 45% of subscribers using AT&T’s advanced home internet services have also adopted AT&T wireless plans. This figure represents a three-percentage-point climb from the previous year and specifically excludes new fiber subscribers acquired through the Lumen transaction.
The analyst interprets this data as validation that AT&T’s convergence approach is gaining traction — combining 5G, fiber, and Wi-Fi services into integrated packages designed to strengthen customer retention.
EBITDA and Cash Flow Projections
Based on the quarterly performance, Petti adjusted his 2026 adjusted EBITDA forecast upward to $48.1 billion, incorporating anticipated growth in bundled customer accounts, recently implemented pricing adjustments, and contributions from the Lumen asset integration.
The analyst also revised his second-quarter projection for net postpaid phone customer additions to 330,000 units from a prior estimate of 320,000. His Overweight rating and year-end price objective of $33 continue without modification.
Petti forecasts compound annual growth rates of 4% for EBITDA and 12% for free cash flow per share extending through the close of 2028.
AT&T distributed a quarterly dividend of $0.2775 per share on May 1st, translating to an annualized yield of approximately 4.2%. The current payout ratio registers at 37.25%.
Wall Street Ratings and Institutional Holdings
Broader Wall Street sentiment remains supportive. Among 21 analysts monitored by MarketBeat, one assigns a Strong Buy rating, thirteen maintain Buy recommendations, and seven rate the stock as Hold. The average target price across these analysts stands at $30.55.
Citigroup elevated its price objective to $31.50 alongside a Buy rating during March. Scotiabank adjusted its target downward to $31.00 in late April while preserving a Sector Perform designation.
Regarding institutional ownership patterns, Truist Financial expanded its AT&T stake by 3% during the fourth quarter, purchasing 163,766 additional shares to reach a total holding of 5,694,478 shares valued at approximately $141.45 million. Multiple other institutional investors similarly increased their positions during the third quarter.
AT&T’s 52-week price range spans from $22.95 to $29.79. The stock’s 50-day moving average currently sits at $27.52, while the 200-day moving average registers at $26.05.
In related developments, AT&T introduced expanded cybersecurity solutions for small business customers this week, featuring Dynamic Defense capabilities on AT&T Business Fiber connections.
