Nokia Oyj vs. AT&T: Which Technology Stock Is a Better Buy in 2026?
2026-09-30 14:35
•Jake Lerch •The Motley Fool
•••••• •••••• Axe Cap view
Nokia or AT&T for 2026: Growth vs. Income in Telecom
Choosing between Nokia’s future growth promise and AT&T’s solid income remains a classic tech sector trade-off.
Nokia and AT&T represent two distinct telecom investment profiles. Nokia is playing the long game with AI infrastructure and cloud tech, supported by a clean balance sheet and good cash flow. But it’s pricey and currently less profitable. AT&T, meanwhile, offers juicy dividends and strong profitability at a bargain valuation, albeit saddled with heavy debt that’s gradually coming down. For South African investors, the key is how the rand moves against the dollar. A weaker rand makes AT&T’s attractive dividends more valuable locally but also raises concerns over currency risks. Nokia’s pure tech growth story has less direct SA appeal, except through a stable USD/ZAR outlook. If debt concerns at AT&T escalate, its income story might falter, while Nokia’s premium could be punished if AI rollout disappoints. Both have their paths, but patience is needed either way—. this is just our opinion and not financial advice
We’d watch AT&T for income investors comfortable with some debt risk, and wait on Nokia until valuation aligns better with growth visibility. Keep USD/ZAR on the radar as it materially affects returns.
- AT&T
- Nokia
- USD/ZAR
- AT&T’s large debt load and interest rates rising
- Nokia’s high valuation and execution on AI infrastructure
6/10
The article compares Nokia Oyj and AT&T as investment options in 2026. AT&T offers better current valuations, higher profitability margins (21.2% operating margin), and a strong 4.5% dividend yield, but carries significant net debt of $146 billion. Nokia trades at a premium valuation (26.5x forward P/E) with lower profitability (11.1% operating margin) but has no net debt and is positioned to benefit from AI infrastructure buildout. The analysis concludes that value/income investors should favor AT&T, while growth-oriented investors should consider Nokia.
Our take is based on reporting first published by The Motley Fool.
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