AT&T (T) Stock Forecast & Price Target

AT&T's strong financial performance is highlighted by a 2.2% year-over-year increase in Segment EBITDA to $9.7 billion, driven by cost efficiencies that offset rising acquisition costs and subsidies. The company also reported a 2.3% increase in service revenue to $16.9 billion, supported by a 2.1% growth in postpaid phone subscribers despite a slight decline in average revenue per user (ARPU). Furthermore, broadband revenue demonstrated impressive growth, rising by 8.2%, with fiber revenue increasing by 17%, indicating a positive trajectory for future expansions in this segment.

AT&T derives nearly 70% of its revenue from its wireless business, which is facing heightened competition and anticipated lower growth for the fourth quarter, as indicated by management's guidance. The company's performance in its Business Wireline unit, while slightly better than expected, still points to a projected low double-digit revenue decline for the year, suggesting ongoing weakness in this segment. Additionally, AT&T's significant challenges include a burdensome debt load, rising pension expenses, and risks associated with regulatory pressures and increasing operational costs, which collectively contribute to a negative outlook on its financial stability.