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AT&T & Charter: Which Stock is a Smart Investment Right Now?
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Key Takeaways
T added 261K fiber customers in the first quarter of 2025 and plans to reach 60M locations by 2030.
CHTR aims to extend fiber to 1.7M rural locations, investing $7B to boost multi-gig speeds nationwide.
EPS estimates for CHTR are rising, with a 13.07% growth forecast, while T's EPS is expected to fall 8.41%.
AT&T Inc. (T - Free Report) and Charter Communications (CHTR - Free Report) are major players in the fiber broadband industry. Operating as one of the largest wireless service providers in North America, AT&T offers a vast array of communication and business solutions that include wireless, local exchange, long-distance, data/broadband and Internet, video, managed networking, wholesale and cloud-based services.
Charter is the second largest cable operator in the United States and a leading broadband communications company providing video, Internet and voice services. The company served approximately 30.1 million customers in 41 states through its Spectrum brand.
With deep industry expertise, both AT&T and Charter are strategically positioned in the highly competitive U.S. telecommunications landscape. Let us analyze in depth the competitive strengths and weaknesses of the companies to understand who is in a better position to maximize gains from the emerging market trends.
The Case for AT&T
AT&T is benefiting from growing demand in its fiber network business. In the first quarter of 2025, AT&T added 261,000 fiber customers. The company’s fiber broadband recently reached 30 million consumer and business locations across the United States. AT&T’s extensive fiber network has become a major driver for innovation across several industries over the years. Its symmetrical download and upload speed, combined with fast Internet, effectively supports high bandwidth-intensive applications. AT&T fiber offerings also include multi-gig speeds up to 5 Gbps in some selected regions.
The company is steadily expanding its network coverage with a strong emphasis on high-density markets where demand for ultra-high-speed Internet is strong. The company is set to acquire Lumen’s Mass Markets fiber Internet connectivity business for $5.75 billion. Following the completion of the buyout, AT&T will gain access to Lumen’s comprehensive fiber construction capabilities, which will help the company accelerate fiber expansion beyond its traditional wireline region.
The company will gain Lumen’s vast customer base, totaling around 1 million across 4 million fiber locations spanning 11 U.S. states. This will boost the availability of AT&T fiber in major metro areas including Denver, Las Vegas, Minneapolis-St. Paul, Orlando, Phoenix, Portland, Salt Lake City and Seattle. The initiative is a major leap toward achieving a long-term target of reaching 60 million fiber locations by 2030.
With a customer-focused business model, AT&T is witnessing solid traction in its postpaid wireless business with a lower churn rate and increased adoption of higher-tier unlimited plans. In the first quarter of 2025, AT&T recorded 324,000 postpaid wireless phone additions with a postpaid churn of 0.83%. The company has been steadily expanding its 5G coverage. Its 5G with low band spectrum is available to 315+ million people in more than 26,200 cities in the United States, while AT&T 5G+, powered by mid band spectrum, is available to 280 million people.
However, AT&T operates in a highly competitive market. In the fiber network business, T faces stiff competition from Verizon Communications Inc. (VZ - Free Report) and Charter. The company’s wireline division is struggling with persistent losses in access lines as a result of competitive pressure from voice-over-Internet protocol (VoIP) service providers and aggressive triple-play (voice, data, video) offerings by the cable companies. At the end of the first quarter, the company had a current ratio of 0.7 and a cash ratio of 0.14. It indicates that it may face challenges in meeting short-term debt obligations.
The Case for Charter
Charter’s high-capacity, two-way telecommunications network passes through 57 million households and small and medium businesses across the United States. Unlike its competitors, AT&T and Verizon, Charter offers 1 Gbps speed across its 100% footprint. Moreover, the company is planning to enhance its network infrastructure to offer symmetrical and multi-gig speeds across its entire footprint over the next three years at a lower cost.
The company is one of the largest and fastest-growing rural Internet providers in the country. Charter is committed to investing $7 billion to add 100,000+ miles of fiber-optic network infrastructure. The goal is to deliver symmetrical and multi-gigabit Internet services across 1.7 million locations. Such a fiber network infrastructure initiative will be a game changer for industries operating in rural spaces and significantly boost Charter’s customer base.
Charter’s Spectrum Mobile has expanded 5G coverage nationwide. In the first quarter of 2025, Charter added 514 thousand total mobile lines compared with 486 thousand in the year-ago quarter. As of March 31, 2025, the company served 10.4 million mobile lines. Charter’s Spectrum One continues to win market share with its differentiated offerings like Mobile Speed Boost and Spectrum Mobile Network. Moreover, following its merger with Cox, Charter is set to gain Cox’s extensive commercial fiber assets and managed IT and cloud businesses. The acquisition will strengthen Charter’s competitive position in the mobile and broadband communications space.
However, Charter faces triple play competition, consisting of wireline multichannel video, wireline Internet, and wireline voice service, from three primary competitors, AT&T, Frontier and Verizon. Verizon is set to acquire Frontier in a $20 billion deal to accelerate its fiber broadband expansion nationwide. Owing to the limited overlap of Verizon and Frontier’s footprints, the deal will not reduce competition in the market. The company’s current ratio stands at 0.36, while the debt-to-cap ratio is 82.2%.
How Do Zacks Estimates Compare for CHTR & T?
The Zacks Consensus Estimate for Charter’s 2025 sales and EPS implies year-over-year growth of 0.33% and 13.07%, respectively. The EPS estimates have been trending upward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AT&T’s 2025 sales indicates growth of 1.57% year over year, while EPS is projected to decline 8.41%. The EPS estimates have been trending southward over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of CHTR & T
Over the past year, AT&T has gained 54.6%, while CHTR has returned 36.1%.
Image Source: Zacks Investment Research
CHTR looks more attractive than AT&T from a valuation standpoint. Going by the price/earnings ratio, CHTR’s shares currently trade at 8.97 forward earnings, lower than 13.02 for AT&T.
Charter has shown steady revenue growth over the past few years, while AT&T has been facing a bumpy road. Healthy momentum in the postpaid business, network modernization and efforts to boost operational efficiency are positives for AT&T. However, declining wireline customers and stiff competition are major headwinds for the company. Upward estimate revisions underscore bullish investor sentiment for Charter’s stock. With an aggressive fiber expansion strategy and attractive valuation metrics, Charter appears to be a better investment option.
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AT&T & Charter: Which Stock is a Smart Investment Right Now?
Key Takeaways
AT&T Inc. (T - Free Report) and Charter Communications (CHTR - Free Report) are major players in the fiber broadband industry. Operating as one of the largest wireless service providers in North America, AT&T offers a vast array of communication and business solutions that include wireless, local exchange, long-distance, data/broadband and Internet, video, managed networking, wholesale and cloud-based services.
Charter is the second largest cable operator in the United States and a leading broadband communications company providing video, Internet and voice services. The company served approximately 30.1 million customers in 41 states through its Spectrum brand.
With deep industry expertise, both AT&T and Charter are strategically positioned in the highly competitive U.S. telecommunications landscape. Let us analyze in depth the competitive strengths and weaknesses of the companies to understand who is in a better position to maximize gains from the emerging market trends.
The Case for AT&T
AT&T is benefiting from growing demand in its fiber network business. In the first quarter of 2025, AT&T added 261,000 fiber customers. The company’s fiber broadband recently reached 30 million consumer and business locations across the United States. AT&T’s extensive fiber network has become a major driver for innovation across several industries over the years. Its symmetrical download and upload speed, combined with fast Internet, effectively supports high bandwidth-intensive applications. AT&T fiber offerings also include multi-gig speeds up to 5 Gbps in some selected regions.
The company is steadily expanding its network coverage with a strong emphasis on high-density markets where demand for ultra-high-speed Internet is strong. The company is set to acquire Lumen’s Mass Markets fiber Internet connectivity business for $5.75 billion. Following the completion of the buyout, AT&T will gain access to Lumen’s comprehensive fiber construction capabilities, which will help the company accelerate fiber expansion beyond its traditional wireline region.
The company will gain Lumen’s vast customer base, totaling around 1 million across 4 million fiber locations spanning 11 U.S. states. This will boost the availability of AT&T fiber in major metro areas including Denver, Las Vegas, Minneapolis-St. Paul, Orlando, Phoenix, Portland, Salt Lake City and Seattle. The initiative is a major leap toward achieving a long-term target of reaching 60 million fiber locations by 2030.
With a customer-focused business model, AT&T is witnessing solid traction in its postpaid wireless business with a lower churn rate and increased adoption of higher-tier unlimited plans. In the first quarter of 2025, AT&T recorded 324,000 postpaid wireless phone additions with a postpaid churn of 0.83%. The company has been steadily expanding its 5G coverage. Its 5G with low band spectrum is available to 315+ million people in more than 26,200 cities in the United States, while AT&T 5G+, powered by mid band spectrum, is available to 280 million people.
However, AT&T operates in a highly competitive market. In the fiber network business, T faces stiff competition from Verizon Communications Inc. (VZ - Free Report) and Charter. The company’s wireline division is struggling with persistent losses in access lines as a result of competitive pressure from voice-over-Internet protocol (VoIP) service providers and aggressive triple-play (voice, data, video) offerings by the cable companies. At the end of the first quarter, the company had a current ratio of 0.7 and a cash ratio of 0.14. It indicates that it may face challenges in meeting short-term debt obligations.
The Case for Charter
Charter’s high-capacity, two-way telecommunications network passes through 57 million households and small and medium businesses across the United States. Unlike its competitors, AT&T and Verizon, Charter offers 1 Gbps speed across its 100% footprint. Moreover, the company is planning to enhance its network infrastructure to offer symmetrical and multi-gig speeds across its entire footprint over the next three years at a lower cost.
The company is one of the largest and fastest-growing rural Internet providers in the country. Charter is committed to investing $7 billion to add 100,000+ miles of fiber-optic network infrastructure. The goal is to deliver symmetrical and multi-gigabit Internet services across 1.7 million locations. Such a fiber network infrastructure initiative will be a game changer for industries operating in rural spaces and significantly boost Charter’s customer base.
Charter’s Spectrum Mobile has expanded 5G coverage nationwide. In the first quarter of 2025, Charter added 514 thousand total mobile lines compared with 486 thousand in the year-ago quarter. As of March 31, 2025, the company served 10.4 million mobile lines. Charter’s Spectrum One continues to win market share with its differentiated offerings like Mobile Speed Boost and Spectrum Mobile Network. Moreover, following its merger with Cox, Charter is set to gain Cox’s extensive commercial fiber assets and managed IT and cloud businesses. The acquisition will strengthen Charter’s competitive position in the mobile and broadband communications space.
However, Charter faces triple play competition, consisting of wireline multichannel video, wireline Internet, and wireline voice service, from three primary competitors, AT&T, Frontier and Verizon. Verizon is set to acquire Frontier in a $20 billion deal to accelerate its fiber broadband expansion nationwide. Owing to the limited overlap of Verizon and Frontier’s footprints, the deal will not reduce competition in the market. The company’s current ratio stands at 0.36, while the debt-to-cap ratio is 82.2%.
How Do Zacks Estimates Compare for CHTR & T?
The Zacks Consensus Estimate for Charter’s 2025 sales and EPS implies year-over-year growth of 0.33% and 13.07%, respectively. The EPS estimates have been trending upward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AT&T’s 2025 sales indicates growth of 1.57% year over year, while EPS is projected to decline 8.41%. The EPS estimates have been trending southward over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of CHTR & T
Over the past year, AT&T has gained 54.6%, while CHTR has returned 36.1%.
Image Source: Zacks Investment Research
CHTR looks more attractive than AT&T from a valuation standpoint. Going by the price/earnings ratio, CHTR’s shares currently trade at 8.97 forward earnings, lower than 13.02 for AT&T.
Image Source: Zacks Investment Research
CHTR or T: Which is a Better Pick?
Charter and AT&T carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Charter has shown steady revenue growth over the past few years, while AT&T has been facing a bumpy road. Healthy momentum in the postpaid business, network modernization and efforts to boost operational efficiency are positives for AT&T. However, declining wireline customers and stiff competition are major headwinds for the company. Upward estimate revisions underscore bullish investor sentiment for Charter’s stock. With an aggressive fiber expansion strategy and attractive valuation metrics, Charter appears to be a better investment option.