Bernstein maintains AT&T stock Outperform with $29 price target

On Thursday, Bernstein analysts maintained their Outperform rating and $29.00 price target for AT&T stock (NYSE:T), highlighting the company’s performance that surpassed expectations. According to Bernstein, AT&T has seen an increase in subscriber numbers, more customers are choosing to bundle services, and margins are widening, which are all positive indicators for the telecom giant.

The report from Bernstein noted several key takeaways from AT&T’s recent performance. Postpaid phone net additions grew by 324,000, exceeding the 254,000 consensus and contributing to over 4% growth in wireless service revenue. Additionally, the company reported 442,000 net additions in Fiber and Fixed Wireless Access (FWA). The rate of customers bundling services passed the 40% mark, and total EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased by 4.4% year-over-year, primarily driven by consumer revenue growth.

Despite the positive trends, Bernstein analysts cautioned about potential challenges ahead. They acknowledged that while AT&T’s recent momentum could provide an upside, there are concerns about macroeconomic factors that could emerge later in the year. Moreover, the telecom industry is known for its high competitive intensity, which could partially offset AT&T’s current trajectory.

Bernstein’s analysis indicates that management at AT&T is proactively addressing these risks. The company is pulling forward planned cost initiatives as a precautionary measure to mitigate any potential impact from the macroeconomic environment.

In summary, while Bernstein analysts recognize that not everything is perfect and there are risks on the horizon, they reaffirm their confidence in AT&T’s performance by maintaining an Outperform rating with a price target of $29. The firm’s stance reflects a belief in the company’s current momentum and its proactive approach to managing foreseeable challenges.

In other recent news, AT&T reported its first-quarter 2025 financial results, revealing revenue of $30.6 billion, surpassing the forecast of $30.39 billion. However, earnings per share (EPS) slightly missed expectations, coming in at $0.51 compared to the anticipated $0.52. The company’s free cash flow for the quarter was reported at $3.1 billion, reflecting a significant year-over-year increase. Analysts at JPMorgan raised the price target for AT&T stock to $31, maintaining an Overweight rating, following these strong results. Evercore ISI also adjusted its price target for AT&T to $27, citing healthy increases in wireless and broadband net additions. AT&T’s management expressed confidence in meeting its full-year financial targets, despite a competitive environment and higher churn rates. The company continues to expand its fiber network, aiming to reach 50 million locations by 2029, and announced a $10 billion share repurchase program. These developments underscore AT&T’s strategic focus on network modernization and fiber expansion, positioning the company for future growth.

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