Telephone & Data Systems (TDS) AI Stock Analysis

• Market Cap: $4.75B
• Dividend Yield: 0.39%
• Average Volume (3M): 887.97K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.99
• Revenue Growth: -22.79%
• EPS Growth: 79.90%
• Country: US
• Employees: 7,900
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 0.33
• Shares Outstanding: 106,200,000
• 10 Day Avg. Volume: 1,101,293
• 30 Day Avg. Volume: 887,974
• PEG Ratio: 33.88
• Price to Book (P/B): 0.90
• Price to Sales (P/S): 3.84
• P/FCF Ratio: 24.19
• Enterprise Value/Market Cap: 1.27
• Enterprise Value/Revenue: 2.02
• Enterprise Value/Gross Profit: 4.09
• Enterprise Value/Ebitda: 6.56
• 1Y Price Target: $53.00
• Price Target Upside: 18.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): -0.1
• Revenue Forecast (FY): $1.26B

• Rating: 56 Neutral
• Price Target: $45.00 ▲(0.56% Upside)
• Action: Reiterated Date: 02/24/26
• Date: Action: Reiterated 02/24/26

Overall score reflects weak financial performance (sharp revenue decline and earnings volatility, with leverage constraints) partially offset by solid operating cash flow. The latest earnings call improves the outlook due to major liquidity/balance-sheet actions and defined growth milestones, though execution and contract-related uncertainties remain. Technicals and valuation are mixed, with modest longer-term price support and a high dividend yield tempered by loss-making earnings (negative P/E).

Positive Factors

Consistent Operating Cash Flow

TDS’s consistently positive operating cash flow across the period provides durable liquidity to fund operations, service debt, and support capital programs. That entrenched cash generation underpins strategic investments like fiber builds and reduces reliance on external financing during multi-quarter execution.

Spectrum Monetization & Balance Sheet Repair

The ~$1.02B spectrum sale and large special dividend materially de-risked capital structure by providing cash to repay debt and fund fiber expansion. This structural liquidity event improves borrowing capacity, enables buybacks/returns, and funds strategic growth without immediate earnings dependence.

Accelerating Fiber Build Program

An increased long-term fiber target and accelerating quarterly build cadence reflect scalable network investment and expanding addressable market. Growing fiber penetration and rising residential ARPC support durable recurring revenue upside and improved lifetime customer economics if execution and presales hold.

Negative Factors

Multi-year Revenue Decline

A severe multi-year revenue contraction, especially the sharp 2025 decline, erodes the earnings base and scale benefits. Sustained top-line weakness increases pressure on margins, cash conversion and return on invested capital, making recovery dependent on successful growth initiatives and stabilization.

Meaningful Leverage and Balance Sheet Shifts

Material leverage (roughly parity debt-to-equity) limits financial flexibility and raises refinancing and covenant risk if earnings remain volatile. The large 2025 balance sheet changes increase uncertainty about asset composition and future credit capacity, tempering confidence in long-term stability.

Higher CapEx & Execution Risk for Fiber Expansion

A sizable step-up in capital intensity to fund aggressive 2026 fiber builds raises execution and cash-flow risk. Returns depend on build productivity, presales conversion and penetration; missed targets or slower monetization would worsen free cash flow and strain leverage headroom.

Telephone & Data Systems Business Overview & Revenue Model

Company Description

Telephone and Data Systems, Inc., a telecommunications company, provides communications services in the United States. It operates through two segments: UScellular and TDS Telecom. The company offers wireless solutions to consumers and business and government customers, including a suite of connected Internet of things (IoT) solutions, and software applications for monitor and control, business automation/operations, communication, fleet and asset management, smart water solutions, private cellular networks and custom, and end-to-end IoT solutions; wireless priority services and quality priority and preemption options; smartphones and other handsets, tablets, wearables, mobile hotspots, routers, and IoT devices; and accessories, such as cases, screen protectors, chargers, and memory cards, as well as consumer electronics, including audio, home automation and networking products. It also provides replace and repair services; Trade-In program through which it buys customers' used equipment; internet connections and all-home WI-FI services; TDS TV+, an integrated cloud television platform that offers video content; local and long-distance telephone service, VoIP, and enhanced services; and broadband, IP-based services, and hosted voice and video collaboration services. The company sells its products through retail sales, direct and indirect sales, third-party retailers, and independent agents, as well as through ecommerce and telesales. As of December 31, 2021, it offers its services to customers 5 million wireless connections, and 1.2 million wireline and cable connections. The company was incorporated in 1968 and is headquartered in Chicago, Illinois.

How the Company Makes Money

TDS generates revenue through multiple channels, with its primary earnings coming from its wireless and wireline segments. The wireless segment, primarily through U.S. Cellular, earns money by providing mobile voice and data services to customers via subscription plans, as well as selling mobile devices and accessories. The wireline segment, operated by TDS Telecom, derives revenue from broadband internet services, voice services, and other telecommunications services provided to residential and business clients. Additionally, TDS benefits from partnerships with various technology and service providers, enabling it to offer bundled services and leverage economies of scale. The company also invests in network infrastructure to enhance service delivery, which in turn can drive customer acquisition and retention, further contributing to its revenue growth.

Telephone & Data Systems Financial Statement Overview

Summary

Financial profile is pressured by multi-year revenue contraction and inconsistent profitability (losses in multiple years, including a sharp 2025 deterioration), offset partly by consistently positive operating cash flow. Balance sheet leverage is meaningful (around ~1.0 debt-to-equity in 2023–2024) and 2025 balance sheet shifts add uncertainty, while free cash flow is volatile and often negative.

Income Statement

Revenue has been declining for several years, culminating in a very large drop in 2025 (annual revenue down ~68% versus 2024), which materially weakens the earnings base. Profitability is inconsistent: the company generated positive operating profit and modest net losses in 2024, but posted a large net loss in 2023 and returned to a small net loss in 2025. While EBITDA has remained positive historically (suggesting underlying operating cash generation), the sharp 2025 deterioration and multi-year volatility in net results keep the income statement profile weak.

Balance Sheet

Leverage is meaningful, with debt around equity in 2023–2024 (debt-to-equity ~1.0), which limits flexibility if earnings stay pressured. Equity remains sizable, but has trended down from earlier years, and returns on equity have been negative in 2023–2024 (and near breakeven in other periods), reflecting challenged profitability. The sharp 2025 changes in reported assets and debt suggest a major balance sheet shift, increasing uncertainty and reducing confidence in stability despite still-material equity.

Cash Flow

Operating cash flow has been consistently positive across the period and remained solid in 2025, which is a key support for credit and liquidity. However, free cash flow is volatile and often negative (notably 2022, 2023, and 2025), implying heavy reinvestment and/or weaker cash conversion in down years. 2024 was a brighter spot with positive free cash flow, but the swing back to negative free cash flow in 2025 points to uneven cash generation after capital spending.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.23B	4.96B	5.16B	5.41B	5.33B
Gross Profit	-62.00M	2.83B	2.83B	2.85B	2.86B
EBITDA	553.51M	1.20B	682.00M	1.08B	1.18B
Net Income	-6.24M	-28.00M	-500.00M	62.00M	156.00M
Balance Sheet
Total Assets	8.40B	13.68B	13.92B	14.55B	13.49B
Cash, Cash Equivalents and Short-Term Investments	765.95M	364.00M	236.00M	360.00M	367.00M
Total Debt	1.95B	5.10B	5.14B	4.80B	4.04B
Total Liabilities	3.13B	7.80B	7.91B	7.93B	6.75B
Stockholders Equity	5.27B	5.09B	5.20B	5.85B	5.93B
Cash Flow
Free Cash Flow	195.19M	241.00M	-199.00M	-620.00M	-48.00M
Operating Cash Flow	589.89M	1.15B	1.14B	1.16B	1.10B
Investing Cash Flow	2.14B	-754.00M	-1.33B	-1.78B	-2.46B
Financing Cash Flow	-2.35B	-277.00M	56.00M	613.00M	321.00M

Telephone & Data Systems Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 44.75
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TDS, the sentiment is Neutral. The current price of 44.75 is below the 20-day moving average (MA) of 45.63, above the 50-day MA of 43.35, and above the 200-day MA of 39.05, indicating a neutral trend. The MACD of 0.33 indicates Positive momentum. The RSI at 49.90 is Neutral, neither overbought nor oversold. The STOCH value of 39.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TDS.

Telephone & Data Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VEON	75 Outperform	$3.86B	5.99	53.38%	―	6.42%	―
TKC	74 Outperform	$5.76B	14.28	7.60%	5.57%	19.02%	9.26%
TEO	68 Neutral	$5.20B	-34.04	-2.95%	0.40%	15.38%	-292.52%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
AD	60 Neutral	$4.21B	14.61	5.11%	42.91%	-25.64%	―
TDS	56 Neutral	$4.75B	-68.82	2.65%	0.39%	-22.79%	79.90%
LUMN	55 Neutral	$7.28B	-4.07	―	―	-4.56%	23.46%

Telephone & Data Systems Corporate Events

TDS Unit Completes Spectrum Sale and Declares Dividend

On January 13, 2026, Array Digital Infrastructure, Inc., a subsidiary of Telephone and Data Systems, Inc., completed the previously announced sale of select wireless spectrum assets, including 700 MHz licenses, to AT&T for $1.018 billion in cash under a purchase agreement originally signed on November 6, 2024, with no portion of the consideration deferred. On the same date, Array’s board declared a special cash dividend of $10.25 per share for holders of its Common Stock and Series A Common Stock, with Telephone and Data Systems holding over 70 million shares eligible for this payout and the dividend scheduled to be paid on February 2, 2026 to shareholders of record as of January 23, 2026, returning a substantial portion of the transaction proceeds to equity holders.

The most recent analyst rating on (TDS) stock is a Buy with a $51.00 price target. To see the full list of analyst forecasts on Telephone & Data Systems stock, see the TDS Stock Forecast page.

TDS Amends Credit Agreements to Boost Flexibility

On December 8, 2025, Telephone and Data Systems, Inc. (TDS) and its subsidiary, Array Digital Infrastructure, Inc., entered into amendments to their respective credit agreements. The amendments extend the maturity date of TDS’s credit agreement, remove the credit spread adjustment for the Term SOFR interest rate, adjust the calculation of the consolidated leverage ratio, and increase the capacity for secured and unsecured debt by $300 million. These changes are expected to impact TDS’s financial flexibility and borrowing capacity, potentially influencing its strategic operations and market positioning.

The most recent analyst rating on (TDS) stock is a Buy with a $45.00 price target. To see the full list of analyst forecasts on Telephone & Data Systems stock, see the TDS Stock Forecast page.