JPMorgan raises AT&T stock price target to $31, maintains Overweight

On Thursday, JPMorgan analyst Sebastiano Petti increased the price target on AT&T stock to $31 from the previous target of $28, while reiterating an Overweight rating. The adjustment followed AT&T’s strong first-quarter results, which showcased impressive postpaid phone net additions and robust EBITDA growth. The company also confirmed that it is on track to meet its full-year financial targets.

AT&T’s first-quarter performance has been strong, with the company reporting better-than-expected postpaid phone net additions. This is a key metric for the telecom industry, reflecting the number of new subscribers who have signed up for AT&T’s services. The company’s EBITDA growth was also highlighted as a positive outcome, indicating a healthy increase in earnings before interest, taxes, depreciation, and amortization—a measure of a company’s operating performance.

Despite a more competitive environment with higher churn rates and increased competition for new subscribers, AT&T’s management is confident in reaching its financial guidance for 2025. This guidance was set with the expectation of a normalizing market, which has been reflected in the company’s recent performance. JPMorgan has slightly raised the 2025 consolidated EBITDA forecast for AT&T to $46.19 billion, marking a 3.2% year-over-year increase, which aligns with the company’s own projections for growth of 3% or better.

The firm’s forecast for AT&T’s free cash flow (FCF) in 2025 remains largely unchanged at $16.17 billion, consistent with the company’s guidance of $16 billion or more. This includes an estimate for the second-quarter FCF of $4.17 billion, which is slightly higher than the updated expectations of approximately $4 billion. Additionally, the earnings per share (EPS) estimate for the second quarter has been adjusted to $0.51, with the 2025 EPS now projected at $2.04, fitting within the company’s guided range of $1.97 to $2.07.

AT&T continues to be a top pick for JPMorgan, featured on the US Equity Analyst Focus List. The firm’s favorable outlook on AT&T is supported by the company’s leading position in market convergence, anticipated medium-term EBITDA growth of over 3%, and an attractive valuation with an expected 9% compound annual growth rate in FCF per share and EPS through 2028. Furthermore, the commencement of share buybacks, with $1 billion expected in the second quarter of 2025 and $4 billion over the course of the year, reinforces the positive sentiment toward AT&T stock.

In other recent news, AT&T Inc (NYSE:T). reported its first-quarter 2025 financial results, revealing that while earnings per share (EPS) slightly missed analyst expectations, revenue exceeded forecasts. The company posted an EPS of $0.51, just below the anticipated $0.52, but its revenue reached $30.6 billion, surpassing the forecast of $30.39 billion. This indicates a strong operational performance despite the minor earnings miss. AT&T also announced a $10 billion share repurchase program, emphasizing its commitment to returning value to shareholders. The company continues to expand its fiber network, targeting 50 million locations by 2029. Analyst discussions during the earnings call focused on potential tariff impacts and consumer spending behavior, with AT&T executives addressing concerns about network modernization and capital allocation priorities. The firm remains confident in its 2025 financial guidance, expecting free cash flow to exceed $16 billion and capital investments to be in the $22 billion range.

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