AT&T Inc. (T) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: AT&T Inc.

Updated on October 22, 2026 · accounts published on October 21, 2026

Reading of October 21, 2026: A cash-generating telecom with widening margins, slow sales growth and a heavy debt load

AT&T trades at a P/E of 7.3 over the last 12 months, 35 % below its ten-year median of 11.3 and 62 % below the median of its sector.

• Is AT&T expensive or cheap? AT&T's P/E of 7.3 is 35 % below its ten-year median; it has traded lower only 13 % of the time in the last decade.
• How is the business doing? AT&T's operating margin reached 20 % over the last 12 months, above its 2014-2025 average of 15 %, while revenue grew 2.7 %.
• How strong is the balance sheet? Net debt was $22.67 per share in fiscal 2025, equal to 104 % of the current share price and 2.8× EBITDA.
• What to expect from the next earnings? AT&T reports on January 27, 2027; analysts expect EPS of $0.49, after eight straight quarters of beating estimates.
• Does the network's cash cover the dividend? AT&T paid 42 % of its fiscal 2025 free cash flow in dividends, well inside the 80 % considered healthy for telecoms.

Is AT&T expensive or cheap?

Over the last 12 months AT&T trades at a P/E of 7.3, against a ten-year median of 11.3 and a decade range of 5.3 to 19.5. The sector median is 19.1, which leaves the stock 62 % below its peers. EV/EBITDA gives the same reading: 5.7× versus a five-year average of 7.6×, under the 90 % line that marks a telecom as cheap. The market has not followed earnings: EPS rose 104 % over the last 12 months while the shares fell 14 % and sit 24 % below their 52-week high of $29.10. A free cash flow yield of 12 % supports the low multiple.

How is the business doing?

Profitability is improving faster than sales. The operating margin of 20 % over the last 12 months compares with an average of 15 % across fiscal 2014-2025, and the net margin stands at 17 % with a return on equity of 20 %. Revenue, by contrast, grew just 2.7 % year on year. Return on invested capital tells the other half: 6.0 % over the last 12 months, barely above the sector median of 5.8 %, and not above 10 % in any of the last ten fiscal years. That is the profile of a capital-heavy network: profitable and steady, but each dollar invested earns modestly.

How strong is the balance sheet?

Debt is the main weight on AT&T. Net debt of $22.67 per share in fiscal 2025 is larger than the share price itself, and debt-to-equity stands at 1.5× over the last 12 months. At 2.8× EBITDA, leverage stays inside the 3.5× considered tolerable for telecoms, so it is heavy but within range. The warning signs are short-term: an Altman Z-score of 0.9 sits in the danger zone, and a current ratio of 0.97 means short-term assets do not quite cover short-term liabilities. A Piotroski score of 7 out of 9 points to fundamentals that are improving rather than deteriorating.

What to expect from the next earnings?

On October 21, 2026 AT&T reported EPS of $0.65 against $0.60 expected, an 8 % beat that extends its record to 8 of the last 8 quarters. Analysts have not reacted much: the 2026 EPS consensus stayed at $2.34 over the last 30 days among 12 analysts, and the revenue estimate barely moved. Of the 62 analysts covering the stock, 26 say buy, 29 hold and 6 sell, a split that matches the cautious price. For January 27, 2027, the figure to watch beyond the $0.49 EPS estimate is revenue, since growth below 3 % is the weak spot in an otherwise solid set of numbers.

Does the network's cash cover the dividend?

Telecoms are capital-hungry cash machines, so they are judged by free cash flow and the dividend it funds rather than by growth. On that test AT&T passes almost every bar. The EBITDA margin of 44 % in fiscal 2025 clears the 30 % healthy level, capex took 17 % of revenue against a 20 % ceiling, and free cash flow yields 12 % on the current price, double the 6 % benchmark. The 4.7 % dividend yield absorbs 42 % of free cash flow and 37 % of earnings. The one miss is growth: revenue per share rose 1.3 % a year over fiscal 2022-2025, below the 2 % healthy level.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.