Key Takeaways
- Timothy Horan of Oppenheimer lowered AT&T’s rating from Outperform to Perform, eliminating his previous $32 price objective.
- Shares of AT&T plunged 4.4% to $23.56 on Wednesday — marking the steepest single-session decline since October 2025 — with the stock now trailing 5.2% for the year.
- The rating cut stems from intensifying satellite broadband rivalry posed by SpaceX’s Starlink and Amazon’s Leo services, which Horan believes could diminish AT&T’s internet customer base.
- The anticipated public debut of SpaceX next week is expected to heighten awareness of the satellite challenge facing conventional broadband companies.
- Horan forecasts that satellite LEO operators will add more than 2 million customers annually, achieving 10% market penetration by 2030, with Starlink now competitively priced against traditional broadband.
AT&T (T) Shares Slide 4.4% Following Oppenheimer Downgrade Amid Satellite Threat Concerns
Shares of AT&T tumbled 4.4% to $23.56 on Wednesday following a rating downgrade from Oppenheimer analyst Timothy Horan, who shifted the telecommunications company from Outperform to Perform while eliminating his previous $32 price objective. The decline represented the stock’s sharpest single-day retreat since October 2025.
The downgrade wasn’t triggered by operational missteps at AT&T. Rather, it reflects mounting concerns about an emerging competitive force from space.
Horan’s primary worry revolves around the escalating challenge from satellite low-earth-orbit (LEO) broadband operators, notably SpaceX’s Starlink and Amazon’s Leo platforms. The analyst contends that traditional telecommunications companies are failing to recognize the disruptive potential of satellite internet on fixed broadband markets, drawing parallels to how cable providers underestimated the impact of fixed wireless technology.
“We are concerned the industry is underestimating the risk of satellite as cable did with [fixed wireless access],” Horan stated in his investment note.
SpaceX Public Offering Expected to Amplify Competitive Concerns
The timing of Horan’s downgrade carries strategic significance. With SpaceX scheduled to launch its initial public offering next week, the analyst predicts the event will intensify scrutiny on the competitive challenge satellite technology presents to established telecom operators like AT&T.
Horan anticipates satellite providers will attract over 2 million new subscribers annually and could command 10% of the market by 2030. He further observes that Starlink has achieved pricing parity with conventional broadband services, while capacity is projected to expand tenfold with the deployment of V3 satellites.
Among AT&T, Verizon, and T-Mobile, Horan identifies AT&T as facing the greatest vulnerability. He points to AT&T’s extensive wireline infrastructure and its slower expansion of fixed wireless access compared to competitors as primary risk factors. The analyst also anticipates downward pressure on average revenue per user (ARPU), with T-Mobile and Verizon’s superior cost frameworks intensifying competitive dynamics.
AT&T CEO John Stankey has directly addressed the satellite competition narrative. During the company’s annual shareholder gathering in May, he recognized satellite’s utility in serving remote locations but maintained: “I don’t think satellite is a substitute for the speed, reliability and capability of our assets that we’ve been investing in for decades.”
AT&T’s Quarter-Trillion Dollar Infrastructure Initiative
The telecommunications giant is actively responding to competitive pressures. In March, AT&T unveiled a strategy to invest $250 billion over the next five years to accelerate fiber, 5G, and wireless infrastructure deployment nationwide.
During the Q1 earnings conference call in April, Stankey reported that AT&T currently provides fiber access to over 37 million customer locations and expects to extend coverage to more than 60 million locations by decade’s end.
The company has also rolled out a promotional package combining home internet and wireless service starting at just $35 monthly.
Analysts from Wall Street firms and contributors on Seeking Alpha currently maintain a Buy consensus on AT&T, though Seeking Alpha’s Quant rating system assigns it a Hold designation with a 3.42 out of 5 score, reflecting strong profitability metrics but weaker growth prospects.
AT&T stock has declined 5.2% year-to-date in 2026.
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