AT&T's Dividend Costs the Company a Fixed Amount Every Quarter Regardless of Competitive Pressure From Starlink or Cable Rivals. Here's the Coverage Ratio That Actually Determines Whether It's Safe.

AT&T, a prominent player in the U.S. cellphone market, faces intense competition from various rivals, including cable operators and even SpaceX's Starlink satellite internet service. Despite this competitive landscape, AT&T maintains one of the highest dividend yields in the industry, paying out nearly $2 billion in dividends each quarter.

Analysts typically assess dividend sustainability through the payout ratio, which currently stands at 36% based on trailing 12-month figures. This ratio indicates that AT&T's dividend is well-covered by its cash flow, with a cash dividend payout ratio of 45%—a figure that suggests ample coverage. Additionally, AT&T has been actively reducing its share count through stock buybacks, which has helped lower its dividend outlay.

In the first half of 2026, the company repurchased $4.669 billion worth of shares, compared to $4.135 billion in the same period of 2025. As a result, AT&T's dividend appears to be on even stronger ground now than it was a year ago. While the Motley Fool Stock Advisor analysts did not include AT&T in their list of the 10 best stocks for investment, they still believe the current dividend is safe and does not warrant significant concern from investors.