Telecom Stocks Beat the Market in 2026 — and Analysts Say They Still Look Cheap
Verizon surges 25.5%, AT&T climbs 15.3%, and Charter stages an 11.3% rally — all while the S&P 500 slides. Here is what every value investor needs to know right now.
Telecom stocks have quietly become one of the strongest stories in the 2026 market. While the broader S&P 500 slides into negative territory, the major carriers and cable providers post double-digit gains — and most of them still trade at valuations that analysts describe as deep-value territory.
For investors searching for yield, resilience, and upside in a choppy market, the telecom sector now presents a rare combination: strong price momentum, generous dividends, and forward price-to-earnings ratios that sit well below the market average. Here is a closer look at who is winning, why it matters, and how long the opportunity may last.
Telecoms Outrun the S&P 500 as Value Stocks Take the Lead
The S&P 500 has declined 1.5% so far in 2026. Against that backdrop, Verizon stock has risen 25.5%, AT&T is up 15.3%, and T-Mobile US has advanced 9.1%.
Even shares of cable providers Charter Communications and Comcast, once weighed down by competitive concerns over their home-internet businesses, have staged 11.3% and 14% rallies so far this year, respectively, following double-digit declines last year.
The standout performance of telecommunications stocks dovetails with broader momentum for value plays. The Russell 3000 Value Index has risen 3.3% so far this year, while the Russell 3000 Growth Index has declined 5.5%, according to LSEG.
Also Read : AT&T Wins America Most Trusted Wireless Brand for 17 Straight Years — and the Reason Why Will Surprise You
Deep-Value Ratios Set Telecom Apart
Despite the strong runs, most of these stocks remain historically cheap by standard valuation measures.
Verizon, Charter, and Comcast trade at forward P/E valuations that are less than half of the weighted forward P/E ratios of 21.4 for the S&P 500 communications sector and 21.8 for the full S&P 500.
AT&T trades slightly higher than those three, at a forward P/E of 12.2. T-Mobile US carries a forward P/E of 20.2 — more expensive, but the company expects to grow revenue at a faster pace than rivals AT&T and Verizon, according to consensus estimates.
Wireless Market Share in 2024
The three giants dominate the U.S. wireless telecom space, with T-Mobile holding a 35% market share, Verizon at 34%, and AT&T at 27% in 2024, according to the most recent figures from TeleGeography, updated last April.
Also Read : AT&T Commits $250 Billion to Rebuild US Telecom Network for the Future
Dividend Yields That Stand Out in Any Market
Investors hunting for income will find compelling numbers across the sector. Charter leads the group with the lowest forward P/E of 5.1 and a forward free-cash-flow yield of 15.85%. Comcast carries a dividend yield of 4.14%, well supported by expected free cash flow per share. Verizon tops the dividend table with a yield of 5.54%, and its estimated free cash flow implies headroom of 4.31 percentage points above the payout.
AT&T posts a 3.88% dividend yield that appears well supported by free cash flow, even accounting for the pending EchoStar deal. The company previously guided for annual free cash flow in the low- to mid-$16 billion range, and its free cash flow for 2025 totaled $15.25 billion, according to LSEG.
What Drives Each Major Player
Verizon: New CEO, Big Subscriber Quarter
Investor concerns about Verizon centered on whether new CEO Dan Schulman would spark a damaging price war. Those fears eased when the company reported 616,000 net postpaid phone subscribers in the fourth quarter — its largest such haul since 2019. Citi analyst Michael Rollins acknowledged that Verizon’s ambitions raise competitive concerns for rivals, but wrote in a February note that a substantial portion of that concern had already found its way into wireless stock prices.
AT&T: Fiber Focus Pays Off
AT&T spent years shedding costly media acquisitions and refocusing on core connectivity. The strategy now delivers results. The company sells bundled offerings that improve customer retention, and it continues to expand wireless broadband capability. AT&T struck a $23 billion deal to acquire spectrum licenses from EchoStar, slated for completion in the middle of 2026. As of the fourth quarter, more than four in 10 AT&T fiber subscribers also used the company’s wireless services.
T-Mobile: Cash Returns Take Center Stage
T-Mobile impresses investors through a sharper focus on capital returns. CFO Peter Osvaldik told MarketWatch in February that the company sits on a significant amount of capacity — both to invest in its network and to return cash to shareholders over the next two years through dividends and buybacks.
Charter and Comcast: The Turnaround Story
The cable operators took the hardest hits from wireless competition, but sentiment now shifts. Charter lost broadband subscribers in the fourth quarter, but the number fell below expectations and below the prior year. MoffettNathanson analyst Craig Moffett described Charter as enjoying an astounding turnaround driven by bundled streaming packages.
Comcast operates beyond pure telecom, spanning studios, theme parks, and streaming. Wolfe Research analyst Peter Supino wrote after the fourth-quarter earnings report that Comcast results appear to be bottoming — though he noted that management continues to avoid acknowledging what he views as the failure of a conglomerate structure, causing investors to undervalue individual business segments including NBCUniversal.
Warner Bros. Discovery: The Wildcard
Warner Bros. Discovery sits at the bottom of the S&P 500 communications sector table, with no forward P/E because the consensus earnings estimate for 2026 points to a net loss of 16 cents a share. Paramount Skydance expects to complete its acquisition of Warner Bros. Discovery in the third quarter of 2026.
Questions and Answers
Why do telecom stocks outperform the S&P 500 in 2026?
Telecom stocks benefit from a broad rotation into value investing. While the S&P 500 drops 1.5% in 2026, Verizon climbs 25.5%, AT&T gains 15.3%, and T-Mobile advances 9.1%. Investors move toward stable, dividend-paying sectors when growth stocks fall out of favor, and telecom fits that profile perfectly.
Are AT&T and Verizon stocks still cheap in 2026?
Yes. Both AT&T and Verizon trade at forward P/E ratios well below the market average. AT&T carries a forward P/E of 12.2, while Verizon sits even lower. The full S&P 500 trades at a weighted forward P/E of 21.8 — making both telecom giants clear deep-value plays by comparison.
What dividend yield does Verizon offer in 2026?
Verizon delivers the highest dividend yield in the S&P 500 communications sector at 5.54%. The company’s estimated free cash flow supports that payout with 4.31 percentage points of headroom — meaning the dividend looks safe even as Verizon invests in network expansion and subscriber growth.
What is the U.S. wireless market share breakdown among T-Mobile, Verizon, and AT&T?
T-Mobile leads the U.S. wireless market with a 35% share. Verizon follows at 34%, and AT&T holds 27%. These figures come from TeleGeography data, last updated in April 2025, covering 2024 market performance.
