AT&T: Avoid Buying the Dip Despite Recent Outperformance

AT&T's outperformance compared to its peers is notable, but it's possible that its growth could have peaked. The company's stock has held up well since a cautionary note in July, but investors should be cautious about buying into the current dip. The article suggests that while AT&T has done well, it's possible that its growth could slow down in the future.

AT&T (T) closed the most recent trading day at $26.16, moving +1.12% from the previous trading session AT&T (T) Ascends While Market Falls: Some Facts to Note^[1]. This performance was notably better than the S&P 500, which registered a daily loss of 0.38%, and the Dow and tech-heavy Nasdaq, which lost 0.2% and 0.67%, respectively. While AT&T's stock has outperformed its peers, it has dropped by 10.48% in the past month, lagging behind the Computer and Technology sector's gain of 7.44% and the S&P 500's gain of 4.06%.

Market participants are closely following AT&T's financial results, with the company set to announce its earnings on October 22, 2025. Analysts predict an EPS of $0.54, indicating a 10% decline compared to the equivalent quarter last year. Quarterly revenue is anticipated to reach $30.96 billion, a 2.47% increase from the year-ago period. For the annual period, the Zacks Consensus Estimates anticipate earnings of $2.05 per share and a revenue of $124.99 billion, signifying shifts of -9.29% and +2.17%, respectively, from the last year AT&T (T) Ascends While Market Falls: Some Facts to Note^[1].

AT&T's Zacks Rank, which varies between #1 (Strong Buy) and #5 (Strong Sell), currently stands at #3 (Hold), indicating a neutral stance. The company is trading with a Forward P/E ratio of 12.63, which is a discount compared to its industry average Forward P/E of 19.99. Additionally, AT&T has a PEG ratio of 3.31, which is slightly higher than the industry average of 3.2 AT&T (T) Ascends While Market Falls: Some Facts to Note^[1].

Despite the mixed financial outlook, AT&T has made significant strides in its 5G network deployment. The company announced that its 5G Standalone (SA) network is now deployed nationwide, narrowing the gap on T-Mobile's lead AT&T, Verizon chase T-Mobile with nationwide 5G SA^[2]. This development is notable as it shows AT&T's confidence in the technology maturity and its ability to scale the network. The company has also expanded its 5G Reduced Capability (RedCap) network to 250 million points of presence.

However, AT&T's industry ranking is not as strong. The Wireless National industry, which includes AT&T, holds a Zacks Industry Rank of 204, positioning it in the bottom 18% of all 250+ industries. This rank is based on the average Zacks Rank of the individual companies within the sector AT&T (T) Ascends While Market Falls: Some Facts to Note^[1].

In conclusion, while AT&T's recent stock performance has been strong, investors should be cautious about buying into the current dip. The company's growth could have peaked, and its financial outlook is mixed. AT&T's 5G network deployment is a positive development, but the company's industry ranking and financial projections indicate that investors should approach the stock with a balanced perspective.