Stone Fox Capital
Founder, CIO & Portfolio Manager of Stone Fox Capital
Starlink Mobile threatens US carriers' pricing economics even if it takes little market share. AT&T's lack of investment for the future makes its exposure worse. In Peter Adderton's scenario, a $5 monthly price cut on 250 million remaining connections would cost carriers $15 billion a year. x.com x.comÂ
AT&T and Verizon face a fast-arriving threat from SpaceX that their investors kept denying. SpaceX announced a deal to acquire a nationwide low-band spectrum portfolio so Starlink can become a major US mobile carrier. With that spectrum and its Gen2 constellation, Starlink Mobile aims to deliver high-speed mobile broadband anywhere. x.com x.comÂ
AT&T faces downside risk from Starlink coming for cell plans; that competition looks set to leave a mark on the stock. x.comÂ
Verizon and AT&T face pressure as Starlink enters mobile service: Musk's entry into their market should make it harder for incumbents to retain share. x.comÂ
AT&T's dividend backed by free cash flow and buybacks could offer a place to hide if things get uglier. At ~9x 2026 EPS, it has a ~12% FCF yield, ~5% dividend yield and ~6-7% buyback yield. ~$2.8B in repurchases left under the 2026 target implies buying equal to ~6-7% of normal daily volume into year-end; its 5%+ dividend is backed by $18B+ in FCF. Starlink is a threat but seems overblown; the stock can get cheaper, yet AT&T diversifies exposure to new-paradigm bets such as SPCX. x.com x.comÂ
T-Mobile, AT&T and Verizon look vulnerable to Starlink's prospective entry as a mobile carrier: the incumbents have grown complacent and milked customers for too long. Starlink should disrupt them, favoring SpaceX. x.comÂ
Nokia could be a huge beneficiary of Starlink's possible US carrier network because it is one of only two radio suppliers for cell sites, alongside Ericsson, and existing carriers would have to spend more to compete. SpaceX is seeking access to 80,000 sites, according to the author. Verizon's CEO estimates a full buildout would take at least four to six years and 65,000-80,000 sites; either way, the infrastructure demand looks bullish for Nokia. x.com x.com x.comÂ
T-Mobile's discount to the Street's lowest target could make it a good trade despite the long-term competition risk. The stock trades 14% below that $169 target, offering a valuation-based counterpoint to the concern that even marginal competition could be disastrous. x.comÂ
SpaceX's negative cost of capital gives it an advantage over AT&T and Verizon as it enters mobile telecom; neither incumbent has that funding position. x.comÂ
AT&T's leadership appears to underestimate the SpaceX threat. In a clip circulated by another account, its CEO reportedly called rocket reusability a dream; dismissing SpaceX this way looks like sleepwalking into the incumbent carrier's demise. x.comÂ
Verizon and AT&T generate plenty of cash flow and can slow their spending if needed. Cell phones are widely used, and the carriers' metrics look fine. x.comÂ
SpaceX could need cell towers as a customer, turning Starlink's feared disruption into potential rent for tower REITs. Crown Castle, SBA Communications and American Tower could gain a tenant, while T-Mobile, AT&T and Verizon face a new competitor. x.comÂ
