Should You Buy This High-Yield Dividend Stock Before October 22?

Telecom stocks have been showing strong momentum this quarter as investors move cash into steady, income‑focused names ahead of earnings season. Traditional telecom companies have gained about 14.3% on average since the last reporting cycle, helped by broader optimism across the sector. Global telecom spending is also projected to climb about 4% this year to roughly $1.42 trillion, according to Statista, reflecting steady demand for connectivity and network upgrades.

That growing confidence has put more eyes on AT&T Inc. (T), which currently offers a 4.25% dividend yield and will release its third‑quarter results on Oct. 22, before market open. Analysts expect around a 10% drop in profit year-over-year (YoY), though most are focused on how continued growth in wireless and fiber could offset weakness in its older business lines. The company has also topped Wall Street’s estimates in three of the past four quarters, keeping expectations for another beat alive heading into this report.

With telecom peers outperforming and AT&T’s next results just days away, could this be the buying window dividend investors have been waiting for before Oct. 22? Let’s take a closer look.

AT&T is a major U.S. telecom company focused on wireless and broadband services formed from the Bell System divestiture of 1982 and subsequent re-consolidation in the 90s. Its business runs on recurring revenue from mobile and internet customers, supported by its large network infrastructure and nationwide reach.

Over the past year, T stock has gained 18.76% and is up 13.86% year to date (YTD), showing steady improvement as management tightens execution and cash generation.

The stock trades at a forward P/E of 12.83x, below the sector average of 13.98x, which suggests investors still see some execution risk even as the business becomes more stable.

The main appeal remains its income potential. AT&T pays an annual dividend of $1.11, giving a 4.21% yield, well above the sector’s 2.62% average. The most recent quarterly dividend of $0.278, paid on Oct. 10, sits comfortably within a 50.11% forward payout ratio.

The company’s latest results back up that story. In Q2, revenue came in at $30.8 billion, with diluted EPS at $0.62 compared to $0.49 a year earlier (adjusted EPS of $0.54 versus $0.51). Operating income hit $6.5 billion, while net income reached $4.9 billion, supported by $11.7 billion in adjusted EBITDA.

Cash flow was solid, with $9.8 billion from operations and $4.4 billion in free cash flow, up from $4.0 billion last year. AT&T spent $4.9 billion on capital expenditures and another $1.0 billion on share buybacks. Operationally, it added 401,000 postpaid phone net customers and kept churn low at 0.87%.

Mobility revenue grew 3.5% to $16.9 billion, while fiber and Internet Air added 446,000 new connections combined, lifting fiber broadband revenue nearly 19% year over year to $2.1 billion. The sale of its remaining 70% stake in DIRECTV in July simplified operations and freed more resources for its 5G and fiber initiatives.

AT&T and Boldyn Networks have rolled out cellular service in New York City’s historic Joralemon Street tunnel, the oldest underwater subway tunnel in the city, connecting the 4 and 5 lines between Borough Hall and Bowling Green.

Next up is the crosstown G line, which will connect riders from Court Square in Queens to Hoyt-Schermerhorn in Brooklyn. AT&T is the first carrier to bring service to these tunnels, marking an early step in what will be one of Brooklyn’s biggest wireless upgrades in years.

Alongside that, the company has launched a new partnership with Gigs to change how people get phone plans. The platform lets technology brands embed mobile plans directly into their apps, so customers can sign up within seconds, manage everything in one place, and get fully automated support. Klarna (KLAR) is the first partner, and the setup allows AT&T to reach new users through digital storefronts with almost no marketing costs.

AT&T is also investing in community programs. Through a $725,000 collaboration with Digitunity, local groups across Arkansas, Mississippi, and Louisiana will help roughly 13,200 people gain access to computers, internet service, and digital skills training. The program gives veterans, healthcare workers, and educators the tools to expand opportunities in underserved areas.

On the business side, AT&T is growing its Office@Hand offerings with new RingCX and RingSense tools. These AI‑based solutions help companies manage customer calls, analyze feedback, and coach service teams more effectively. Combined with AT&T’s fiber, 5G, and SD‑WAN technologies, these upgrades give businesses better communication tools that are simpler and more affordable to deploy.

AT&T expects 2025 service revenue to inch higher, with mobility revenue growing about 3% or more and consumer fiber broadband climbing in the mid‑to‑high teens. The company plans to spend between $22 billion and $22.5 billion this year and still generate around $16 billion in free cash flow, even after covering a large share of its pension obligations. It forecasts earnings per share of $1.97 to $2.07 and aims to buy back about $4 billion in stock, with roughly $1.3 billion already completed.

Analyst sentiment has been firmly positive leading into the earnings release. On Oct. 16, Bernstein’s Laurent Yoon reiterated a “Buy” rating with a $32 price target, pointing out that the market still undervalues AT&T’s ability to translate execution into stronger earnings and cash flow.

Citi’s Michael Rollins also kept a “Buy” call on Oct. 8, expecting another stable quarter that highlights strong cash generation and supports its position as one of the most reliable dividend payers in the sector. Wells Fargo’s Eric Luebchow followed on Oct. 17 with a “Buy” and a $29 target, noting the company’s consistent subscriber additions and continued fiber growth as near-term growth drivers.

Overall, 30 analysts rate the stock a “Moderate Buy,” with a mean price target of $30.65. That means from the current roughly $26 level, there’s an estimated 18% upside.

For income investors looking at timing, AT&T’s setup into the Oct. 22 earnings looks increasingly constructive. The company isn’t flashing growth stock upside, but the combination of consistent execution, a 4.25% yield, improving free cash flow, and visible capital discipline makes it one of the steadier dividend picks among large‑cap telecoms. If quarterly results reinforce stable margins and rising fiber momentum, shares are more likely than not to grind higher into year‑end.

On the date of publication, Ebube Jones 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. This article was originally published on Barchart.com

Telecom stocks have been showing strong momentum this quarter as investors move cash into steady, income‑focused names ahead of earnings season. Traditional telecom companies have gained about 14.3% on average since the last reporting cycle, helped by broader optimism across the sector. Global telecom spending is also projected to climb about 4% this year to roughly $1.42 trillion, according to Statista, reflecting steady demand for connectivity and network upgrades.

That growing confidence has put more eyes on AT&T Inc. (T), which currently offers a 4.25% dividend yield and will release its third‑quarter results on Oct. 22, before market open. Analysts expect around a 10% drop in profit year-over-year (YoY), though most are focused on how continued growth in wireless and fiber could offset weakness in its older business lines. The company has also topped Wall Street’s estimates in three of the past four quarters, keeping expectations for another beat alive heading into this report.

With telecom peers outperforming and AT&T’s next results just days away, could this be the buying window dividend investors have been waiting for before Oct. 22? Let’s take a closer look.

AT&T is a major U.S. telecom company focused on wireless and broadband services formed from the Bell System divestiture of 1982 and subsequent re-consolidation in the 90s. Its business runs on recurring revenue from mobile and internet customers, supported by its large network infrastructure and nationwide reach.

Over the past year, T stock has gained 18.76% and is up 13.86% year to date (YTD), showing steady improvement as management tightens execution and cash generation.

The stock trades at a forward P/E of 12.83x, below the sector average of 13.98x, which suggests investors still see some execution risk even as the business becomes more stable.

The main appeal remains its income potential. AT&T pays an annual dividend of $1.11, giving a 4.21% yield, well above the sector’s 2.62% average. The most recent quarterly dividend of $0.278, paid on Oct. 10, sits comfortably within a 50.11% forward payout ratio.

The company’s latest results back up that story. In Q2, revenue came in at $30.8 billion, with diluted EPS at $0.62 compared to $0.49 a year earlier (adjusted EPS of $0.54 versus $0.51). Operating income hit $6.5 billion, while net income reached $4.9 billion, supported by $11.7 billion in adjusted EBITDA.

Cash flow was solid, with $9.8 billion from operations and $4.4 billion in free cash flow, up from $4.0 billion last year. AT&T spent $4.9 billion on capital expenditures and another $1.0 billion on share buybacks. Operationally, it added 401,000 postpaid phone net customers and kept churn low at 0.87%.

Mobility revenue grew 3.5% to $16.9 billion, while fiber and Internet Air added 446,000 new connections combined, lifting fiber broadband revenue nearly 19% year over year to $2.1 billion. The sale of its remaining 70% stake in DIRECTV in July simplified operations and freed more resources for its 5G and fiber initiatives.

AT&T and Boldyn Networks have rolled out cellular service in New York City’s historic Joralemon Street tunnel, the oldest underwater subway tunnel in the city, connecting the 4 and 5 lines between Borough Hall and Bowling Green.

Next up is the crosstown G line, which will connect riders from Court Square in Queens to Hoyt-Schermerhorn in Brooklyn. AT&T is the first carrier to bring service to these tunnels, marking an early step in what will be one of Brooklyn’s biggest wireless upgrades in years.

Alongside that, the company has launched a new partnership with Gigs to change how people get phone plans. The platform lets technology brands embed mobile plans directly into their apps, so customers can sign up within seconds, manage everything in one place, and get fully automated support. Klarna (KLAR) is the first partner, and the setup allows AT&T to reach new users through digital storefronts with almost no marketing costs.

AT&T is also investing in community programs. Through a $725,000 collaboration with Digitunity, local groups across Arkansas, Mississippi, and Louisiana will help roughly 13,200 people gain access to computers, internet service, and digital skills training. The program gives veterans, healthcare workers, and educators the tools to expand opportunities in underserved areas.

On the business side, AT&T is growing its Office@Hand offerings with new RingCX and RingSense tools. These AI‑based solutions help companies manage customer calls, analyze feedback, and coach service teams more effectively. Combined with AT&T’s fiber, 5G, and SD‑WAN technologies, these upgrades give businesses better communication tools that are simpler and more affordable to deploy.

AT&T expects 2025 service revenue to inch higher, with mobility revenue growing about 3% or more and consumer fiber broadband climbing in the mid‑to‑high teens. The company plans to spend between $22 billion and $22.5 billion this year and still generate around $16 billion in free cash flow, even after covering a large share of its pension obligations. It forecasts earnings per share of $1.97 to $2.07 and aims to buy back about $4 billion in stock, with roughly $1.3 billion already completed.

Analyst sentiment has been firmly positive leading into the earnings release. On Oct. 16, Bernstein’s Laurent Yoon reiterated a “Buy” rating with a $32 price target, pointing out that the market still undervalues AT&T’s ability to translate execution into stronger earnings and cash flow.

Citi’s Michael Rollins also kept a “Buy” call on Oct. 8, expecting another stable quarter that highlights strong cash generation and supports its position as one of the most reliable dividend payers in the sector. Wells Fargo’s Eric Luebchow followed on Oct. 17 with a “Buy” and a $29 target, noting the company’s consistent subscriber additions and continued fiber growth as near-term growth drivers.

Overall, 30 analysts rate the stock a “Moderate Buy,” with a mean price target of $30.65. That means from the current roughly $26 level, there’s an estimated 18% upside.

For income investors looking at timing, AT&T’s setup into the Oct. 22 earnings looks increasingly constructive. The company isn’t flashing growth stock upside, but the combination of consistent execution, a 4.25% yield, improving free cash flow, and visible capital discipline makes it one of the steadier dividend picks among large‑cap telecoms. If quarterly results reinforce stable margins and rising fiber momentum, shares are more likely than not to grind higher into year‑end.

On the date of publication, Ebube Jones 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. This article was originally published on Barchart.com