AT&T soars to 5-year high, but Is now the most overbought stock in the S&P 500
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 03 2025
0mins
Source: SeekingAlpha
AT&T Stock Performance: AT&T shares are currently the most overbought in the S&P 500 with an RSI of 83.25, indicating strong buying momentum and a potential price exhaustion as the stock reaches a five-year high of $27.27 following positive Q4 earnings results.
Investment Opportunities: Investors seeking exposure to AT&T can consider various exchange-traded funds (ETFs) that have significant allocations towards the stock, amidst its notable performance ranking within the S&P 500 for the year.
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Analyst Views on T
Wall Street analysts forecast T stock price to rise
15 Analyst Rating
8 Buy
5 Hold
2 Sell
Moderate Buy
Current: 20.580
Low
20.00
Averages
28.27
High
33.00
Current: 20.580
Low
20.00
Averages
28.27
High
33.00
About T
AT&T Inc. is a provider of telecommunications and technology services. The Company's segments include Advanced Connectivity, Legacy and Latin America. The Advanced Connectivity segment provides domestic fifth generation (5G) and fiber-based wireless, internet and other advanced connectivity services to consumer and business customers. The Legacy segment provides domestic legacy voice and data services to consumer and business customers over our copper-based network. The Latin America segment provides wireless service and equipment in Mexico. Its plans and services include AT&T Fiber, AT&T Points Plus Card, AT&T Wireless and AT&T Fiber. Its phone plans include Elite 2.0, Premium 2.0, Extra 2.0, and Value 2.0. Its home internet solutions include AT&T Fiber and AT&T Internet Air. It offers phones, tablets, and smartwatches. The Company also offers accessories such as cases, chargers, screen protectors, and headphones.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Urban Market Advantage: T-Mobile holds a 50% household share in major urban areas like New York and Los Angeles, compared to just 24% in rural regions, providing a significant geographic advantage against satellite competition and reducing near-term threats.
- Satellite Competitive Pressure: While SpaceX's deployment of V3 satellites poses long-term pressure on the telecom sector, analysts argue that the immediate competitive threats are overstated, especially in urban markets where satellite direct-to-device capabilities face severe physical constraints.
- Retail Sentiment Optimistic: Retail sentiment on Stocktwits for TMUS, T, and VZ stocks was 'bullish', with message volumes soaring between 100% and 300% compared to the previous session, indicating strong investor interest in fiber optics over satellite connectivity.
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- Upcoming Earnings: The company is set to release its second-quarter earnings on July 22, with hopes that strong results could alleviate investor fears, although AT&T forecasts only low single-digit growth in service revenue, reflecting limited growth potential.
- Attractive Valuation: With a price-to-earnings ratio of 7, significantly below the S&P 500 average of 25, AT&T presents an appealing valuation for investors, especially with a dividend yield around 5.4%, making it an attractive buy.
- Long-Term Investment Opportunity: Given the sharp decline in stock price, AT&T may represent a low-risk investment for long-term investors, particularly as the market may be overreacting to risks from Starlink, suggesting that buying now could yield favorable returns.
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- Strong Financials: Despite the stock's decline, AT&T's financial performance remains robust, with first-quarter revenue up nearly 3% year-over-year; however, the company forecasts low single-digit growth for service revenue this year, indicating sluggish growth prospects.
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- Starlink Business Performance: Despite reporting a net loss of $5 billion in 2025, SpaceX's Starlink connectivity business generated $4.4 billion in operating income, demonstrating the effectiveness of its pricing strategy as both subscribers and profits more than doubled.
- Wireless Service Expansion Plans: SpaceX plans to launch mobile services soon, targeting the $1.6 trillion wireless phone market, potentially enhancing its competitive edge through a partnership with Charter Communications to leverage its network infrastructure.
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See More
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- Market Overreaction: Wall Street analysts believe the recent sell-off in U.S. telecom stocks is excessive, with expectations for a relief rally driven by strong upcoming earnings reports, particularly as BofA upgraded T-Mobile to a 'Buy' rating with a $220 price target.
- Urban Market Advantage: T-Mobile holds a 50% household share in major urban areas like New York and Los Angeles, compared to just 24% in rural regions, providing a significant geographic advantage against satellite competition and reducing near-term threats.
- Satellite Competitive Pressure: While SpaceX's deployment of V3 satellites poses long-term pressure on the telecom sector, analysts argue that the immediate competitive threats are overstated, especially in urban markets where satellite direct-to-device capabilities face severe physical constraints.
- Retail Sentiment Optimistic: Retail sentiment on Stocktwits for TMUS, T, and VZ stocks was 'bullish', with message volumes soaring between 100% and 300% compared to the previous session, indicating strong investor interest in fiber optics over satellite connectivity.
See More
AT&T Shares Under Pressure as Earnings Approach
- Stock Decline: AT&T's shares have fallen 17% this year and are trading near a 52-week low, despite strong financial performance, indicating market concerns about future growth, particularly with SpaceX's Starlink potentially capturing market share.
- Upcoming Earnings: The company is set to release its second-quarter earnings on July 22, with hopes that strong results could alleviate investor fears, although AT&T forecasts only low single-digit growth in service revenue, reflecting limited growth potential.
- Attractive Valuation: With a price-to-earnings ratio of 7, significantly below the S&P 500 average of 25, AT&T presents an appealing valuation for investors, especially with a dividend yield around 5.4%, making it an attractive buy.
- Long-Term Investment Opportunity: Given the sharp decline in stock price, AT&T may represent a low-risk investment for long-term investors, particularly as the market may be overreacting to risks from Starlink, suggesting that buying now could yield favorable returns.
See More
AT&T Stock Plummets Amid SpaceX Concerns
- Stock Decline: AT&T's stock has dropped 17% this year and is nearing multi-year lows, primarily due to concerns over SpaceX potentially capturing market share, which poses a challenge to the company's stability.
- Strong Financials: Despite the stock's decline, AT&T's financial performance remains robust, with first-quarter revenue up nearly 3% year-over-year; however, the company forecasts low single-digit growth for service revenue this year, indicating sluggish growth prospects.
- Attractive Dividend Yield: With a current dividend yield of approximately 5.4%, AT&T's low valuation may present a good buying opportunity for investors, especially ahead of the upcoming earnings report, amidst pessimistic market sentiment regarding its future growth.
- Market Overreaction: Although the market has reacted strongly to the potential threat from Starlink, AT&T's low price-to-earnings ratio of 7 is significantly below the S&P 500 average of 25, suggesting the company may be undervalued, making it a potentially low-risk buy for long-term investors at this time.
See More
SpaceX IPO: Potential in AI and Wireless Markets
- Significant Contract Value: SpaceX's contracts with AI companies like Anthropic and Alphabet are valued at approximately $28 billion, showcasing its strong competitive position in the rapidly growing AI market while laying the groundwork for future revenue growth.
- Broad Market Opportunities: In its IPO registration statement, SpaceX highlighted a total addressable market of $26.5 trillion for its AI business, including a $2.4 trillion infrastructure market, indicating potential for business diversification through expansion into solar-powered orbital data centers.
- Starlink Business Growth: Despite a net loss of $5 billion in 2025, SpaceX's Starlink connectivity business generated $4.4 billion in operating income, demonstrating a doubling of both subscribers and profits while lowering prices, thereby strengthening the company's market position.
- Wireless Service Expansion Plans: SpaceX is reportedly planning to launch mobile services in the U.S., potentially partnering with Charter Communications to leverage its internet infrastructure and mobile virtual network agreement with Verizon, further expanding its market share and enhancing profitability.
See More
Analysis of SpaceX's AI and Connectivity Business Prospects
- AI Market Potential: SpaceX's IPO filing indicates a total addressable market of $26.5 trillion for its AI business, including a $2.4 trillion infrastructure market, suggesting significant growth potential as the company aims to expand into solar-powered orbital data centers.
- Starlink Business Performance: Despite reporting a net loss of $5 billion in 2025, SpaceX's Starlink connectivity business generated $4.4 billion in operating income, demonstrating the effectiveness of its pricing strategy as both subscribers and profits more than doubled.
- Wireless Service Expansion Plans: SpaceX plans to launch mobile services soon, targeting the $1.6 trillion wireless phone market, potentially enhancing its competitive edge through a partnership with Charter Communications to leverage its network infrastructure.
- Investor Focus: While the profitability of SpaceX's AI segment remains uncertain, investors should pay attention to the connectivity business's potential, with projections suggesting that Starlink could generate $120 billion in revenue at a 60% operating margin by 2036, indicating a stronger growth outlook.
See More
AT&T, Mattel, and Hertz Stocks Decline Amid Market Pressures
- AT&T Stock Fluctuations: AT&T's stock hit a 52-week low of $19.89 on Thursday but slightly recovered to close up about 0.49%, yet the stock fell over 9% last week due to concerns over SpaceX's direct-to-consumer mobile expansion, indicating market apprehension towards traditional telecom companies.
- Mattel's Poor Performance: Mattel's stock fell to a 52-week low of $13.17 on Thursday, marking three consecutive weeks of decline primarily due to weak first-quarter sales growth, with a 3% drop in North America despite strong international performance, while gross margins declined and operating losses widened to $103 million, reflecting a challenging consumer environment.
- Hertz Facing Depreciation Pressures: Hertz's stock dropped to a 52-week low of $2.09 amid concerns over rising vehicle depreciation costs and weakness in the used car market, with the company lowering its second-quarter earnings forecast to between $50 million and $80 million, raising worries about its financial health.
- Market Sentiment Shift: All three companies experienced stock declines over the past week, with retail sentiment for AT&T and Hertz shifting from 'extremely bullish' to 'bullish', while Mattel's sentiment dropped from 'neutral' to 'bearish', reflecting investor caution regarding future performance.
See More
