Scotiabank trims targets for AT&T, citing competition fears tied to SpaceX and talk of AI disruption

AT&T shares faced fresh Wall Street scrutiny after Scotiabank cut its price target for the telecom provider, pointing to potential competitive pressure from SpaceX and a broader question for the sector: whether artificial intelligence will change how quickly and how deeply consumers and businesses adopt data-heavy services.

The note also reduced targets for other major communications companies, including Verizon, T-Mobile and Comcast, according to the report. For AT&T specifically, the target was lowered to $27.50 from $29, a move framed as a response to both competitive dynamics and evolving technology narratives.

The report ties the telecom outlook to SpaceX’s push into connectivity, citing the company’s CEO message that “nothing beats” fiber. The framing suggests a debate that has become central to telecom investing: whether traditional wireline broadband remains the benchmark for performance and reliability, or whether non-terrestrial networks can still win meaningful market share through coverage and convenience.

In the same sell-side framing, Scotiabank’s analysis also references the possibility of AI-driven disruption across communications markets. The idea, as presented in the post, is not that AI will eliminate telecom’s role, but that it may change traffic patterns, service bundling and customer behavior faster than investors currently price in.

Telecom research often treats fiber buildout as a durable advantage because it supports high speeds and relatively low latency compared with older copper networks. At the same time, satellite and other alternative connectivity approaches can expand reach where fiber is expensive or slow to deploy. The market tension reflected in the note is that investors must weigh these differing strengths when estimating subscriber growth and pricing power.

The presence of multiple large-name cuts in the same direction also indicates that Scotiabank’s caution is not limited to one company’s execution. Lower targets for Verizon and T-Mobile, along with Comcast, suggest a sector-wide reassessment rather than a single-operator issue, even though each firm operates under different business models and competitive pressures.

The post does not include additional detail on the timing or magnitude of any competitive threat from SpaceX, nor does it specify which AI use cases Scotiabank believes could shift demand. It also does not disclose whether the firm changed any fundamental assumptions such as capital spending levels, churn, pricing, or expected earnings drivers. Without those specifics, the sell-side conclusion appears to be positioned more as a valuation adjustment and scenario risk highlight than a fully quantified forecast update.

For investors and telecom watchers, the next question is whether SpaceX-related connectivity concerns will show up in observable industry metrics such as broadband net adds, retention trends, pricing behavior, and broadband usage per connection. If AI expectations continue to rise, attention will likely turn to how quickly telcos can monetize new demand through higher tiers, business services, and network upgrades, and whether fiber remains the market’s performance gold standard as connectivity options multiply.