Shares of telecommunications giant AT&T (T Quick QuoteT - Free Report) surged higher Thursday after Morgan Stanley analyst Simon Flannery raised his rating on the stock to Overweight from Equal Weight. He argued that the $43 billion deal to combine its media assets with Discovery will create “a much clearer and focused communications business.”

The mega media deal with Discovery is expected to close late next spring, but AT&T has yet to determine how the deal will look for shareholders, meaning if the move will result in a spin-off (providing cash) or a split-off (providing shares).

AT&T recently posted stronger-than-expected Q3 earnings driven by impressive subscriber gains for HBOMax. AT&T now expects its global subscriber base to rise to between 70 million and 73 million by the end of the year.

T has fallen about 20% over the past six months, and is currently a #3 (Hold) on the Zacks Rank.