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Exclusive Story
Former Dividend Aristocrat AT&T Posts Strong Earnings, Tries to Win Back InvestorsWritten by Jessica Mitacek. Posted: 4/24/2026. 
Key Points
- AT&T outperformed analyst expectations with an 11% year-over-year increase in adjusted EPS and record results in fixed broadband and fiber net adds.
- The company is aggressively expanding its fiber footprint through the acquisition of Lumen Technologies’ fiber business and is poised to offer direct-to-device satellite broadband via a partnership with AST SpaceMobile.
- Wall Street is turning increasingly bullish, evidenced by rising price targets, zero Sell ratings, and significant institutional buying.
- Special Report: The Biggest IPO Ever: Claim Your Stake Today
It’s not often that a 141-year-old company generates excitement. But after AT&T (NYSE: T) reported Q1 2026 earnings on April 22, that is exactly how the market has been reacting. After initially selling off in the lead-up to its earnings call, the stock gained nearly 3% on April 23 as investors responded positively to a Q1 acquisition, the company reiterating guidance after posting record fixed broadband results, and a nearly 11% year-over-year increase in adjusted earnings per share (EPS).
In doing so, the communication services fixture appears to be back in Wall Street’s favor, with improving price targets and increased institutional buying signaling bullish momentum. For income investors or those looking for value in telecommunications, here’s what you need to know. After a Troubling Run, the Tide Is ShiftingShares of T have gained nearly 16% from their year-to-date low, a welcome relief for shareholders who endured a more than 22% decline from the stock’s one-year high in Sept. 2025. And despite only one earnings miss in the past nine quarters, AT&T entered 2026 essentially flat over the prior five years. During that period, the company lost its status as a Dividend Aristocrat in February 2022 after spinning off its WarnerMedia division. That wasn't good news for income investors, but the stock had already been struggling before the spinoff. From its February 2020 high to its five-year low in August 2023, AT&T fell more than 50%. Although management does not expect to increase the dividend through at least 2027, the stock has continued to attract investors as it recovers. It still yields about 4.2%, and since its five-year low AT&T has risen more than 86%, with shares trading not far off their 52-week high of $29.79. Meanwhile, the company’s strategic partnership with AST SpaceMobile (NASDAQ: ASTS)—which it signed in 2024—may finally be bearing fruit. On April 22, AST SpaceMobile was granted approval by the U.S. Federal Communications Commission to deliver nationwide, direct-to-device (D2D) cellular broadband from space. The agreement calls for providing space-based cellular broadband directly to everyday, unmodified AT&T mobile devices. In his earnings call comments, CEO John Stankey said the company’s “customers are going to want [D2D space-based broadband], and I think it's natural that we work with [low Earth orbit] providers that have the capabilities to solve that problem, to integrate those offerings into our services.” Q1 Takeaways: AT&T Had Plenty to HighlightAdding to that momentum, AT&T posted a top- and bottom-line beat when it reported Q1 results. EPS of $0.57 topped analyst expectations of $0.55, while quarterly revenue of $31.51 billion beat the $31.29 billion consensus. Notably, the company reported a record first-quarter consumer fixed broadband result, with 584,000 fiber and fixed wireless advanced internet net adds. It also added 1.1 million customers and approximately 4 million fiber locations when it closed a deal in Q1 to acquire Lumen Technologies’ (NYSE: LUMN) Mass Markets fiber business. That acquisition is expected to add about 8 million incremental fiber locations in 2026, and more than 60 million by 2030. AT&T finished Q1 with $12 billion in cash and cash equivalents, and returned $4.3 billion to shareholders during the quarter — $2 billion in dividends and $2.3 billion in share repurchases under a buyback authorization dating back to 2024. Management reiterated full-year and long-term guidance, including free cash flow of more than $18 billion in 2026, more than $19 billion in 2027, and more than $21 billion in 2028, alongside adjusted EPS of $2.25 to $2.35 this year and a double-digit, three-year compound annual growth rate through 2028. Despite the strong EPS growth, the stock can still be viewed as undervalued. It is currently trading at a forward price-to-earnings multiple of around 11.5x, which aligns with an earnings growth forecast of about 10% over the next year. Wall Street Sentiment Is Slowly ShiftingFor the past year, AT&T has maintained a consensus Moderate Buy rating. Over that time, sentiment has shifted. As of today, none of the 22 analysts covering the stock has assigned it a Sell rating. And over the past month, the average 12-month price target has moved from less than 6% to more than 17%. Meanwhile, institutional buyers have outnumbered sellers for six consecutive quarters. Over the past year, inflows of nearly $24 billion have surpassed outflows of just over $10 billion. Short interest has ticked up but still represents only 1.69% of the float. Based on the company’s financial health, the stock re-entered the TradeSmith Green Zone six days ago. AT&T's MarketRank™ currently scores higher than 96% of the companies evaluated by MarketBeat, and it ranks 41st out of 629 stocks in the computer and technology sector. |
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