AT&T (T) shares tumbled on Friday, leading a broader rout in telecom stocks after SpaceX (SPCX) announced an $8 billion deal to acquire a nationwide portfolio of wireless spectrum from Grain Management. The space infrastructure giant plans to use the newly acquired spectrum to strengthen Starlink Mobile and expand its ability to provide mobile connectivity across the U.S.
Following today’s decline, AT&T stock is down about 10% versus the start of this year.
More Top Stocks Daily: Go behind Wall Street’s hottest headlines with Barchart’s Active Investor newsletter.
www.barchart.comWhy the SpaceX Deal Is Hurting AT&T Stock
SpaceX’s push to acquire Grain Management’s nationwide 800 MHz spectrum intensified concerns that the titan may emerge as a more formidable competitor to established mobile network operators.
Low-band spectrum travels much farther and penetrates buildings more effectively than higher-frequency alternatives, potentially helping SpaceX improve coverage and indoor reception. This could eventually challenge AT&T’s subscriber base, pricing power, and long-term growth prospects.
That said, the deal remains subject to regulatory approval — and the extent of any disruption would depend on Starlink Mobile’s rollout, service quality, and commercial strategy.
Should You Buy the Dip in T Shares Today?
Caution is warranted in buying AT&T shares at current levels, as they remain expensive at more than 10x forward earnings, while peer Verizon (VZ) trades at about 9x.
Plus, a better-equipped satellite rival like SpaceX acquiring low-band spectrum raises longer-term questions about competition; investors must assess how AT&T can defend customer relationships while funding network investment.
Even from a technical perspective, T stock's price now sits decisively below its key moving averages (MAs), with an RSI in the early 20s indicating bears remain firmly in control across multiple time frames.
However, a rather attractive 5.01% dividend yield on AT&T makes it attractive as a long-term holding for income-focused investors.
Wall Street’s Consensus View on AT&T
For now, Wall Street analysts rate AT&T stock at “Moderate Buy,” with a mean price target of about $29, indicating massive upside potential from current levels.
However, downward revisions could follow if SpaceX ends up receiving regulatory approvals for its spectrum deal with Grain Management in the weeks ahead.
www.barchart.com On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.