Valued at a market cap of $199 billion, AT&T Inc. (T) provides telecommunications and technology services and is one of the largest wireless service providers in North America. The Dallas, Texas-based company offers a wide range of communication and business solutions that include wireless, local exchange, long-distance, data/broadband and Internet, video, managed networking, wholesale, and cloud-based services.
Companies valued at $10 billion or more are typically classified as “large-cap stocks,” and AT&T fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the telecom services industry. The company’s key strengths include a vast network infrastructure, strong brand recognition, and a large customer base. AT&T benefits from its 5G and fiber expansion, positioning itself for future growth in high-speed connectivity. Additionally, its strategic focus on core telecom services after divesting media assets has improved financial stability, allowing for better network investments and customer experience enhancements.
This telecom giant touched its 52-week high of $27.97 in the last trading session. Shares of AT&T have rallied 11.4% over the past three months, considerably outpacing the broader Communication Services Select Sector SPDR ETF Fund’s (XLC) marginal decline during the same time frame.
In the longer term, AT&T has soared 56.1% over the past 52 weeks, massively outpacing XLC’s 26.9% return. Moreover, on a YTD basis, shares of T are up 15.2%, compared to XLC’s 3.5% uptick over the same time frame.
To confirm its bullish trend, T has been trading above its 200-day moving average since the past year and has remained above its 50-day moving average since early May 2024, despite some fluctuations.
On Jan. 27, shares of AT&T closed up 6.3% after its better-than-expected Q4 earnings release. The company delivered revenues of $32.3 billion, which marginally surpassed the consensus estimates, thanks to higher mobility service and equipment sales and a growth in consumer wireline revenues. Its adjusted EPS came in at $0.54, matching the prior year's figure but surpassing estimates by 12.5%.
Adding to the positives, the company experienced a notable 482,000 postpaid phone net adds in the quarter. Moreover, AT&T Fiber recorded its 20th consecutive quarter of over 200,000 net adds, with 307,000 new subscribers in Q4. These positive trends reinforced AT&T’s momentum in gaining and retaining profitable 5G and fiber subscribers, further bolstering investor confidence.
AT&T’s outperformance becomes more evident when compared to its rival, Verizon Communications Inc. (VZ), which gained nearly 6.4% over the past 52 weeks and 7.2% on a YTD basis.
Looking at AT&T’s recent outperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 28 analysts covering it, and the mean price target of $26.96 suggests a slight 2.8% premium to its current levels.
