What happened

Shares of AT&T (T 1.45%) were recovering some of yesterday's losses as several Wall Street analysts weighed in on the stock following the sell-off on its first-quarter earnings report on Thursday.

As of 10:27 a.m. ET on Friday, the stock was up 3.4%.

So what

At least three analysts think the telecom stock is oversold after it fell 10.5% yesterday on an underwhelming first-quarter earnings report.

JPMorgan Chase analyst Phllip Cusick said the stock should be bought at its current levels, calling the risk/reward profile very favorable, as operating profits were solid in the first quarter. Cusick maintained an overweight rating on the stock but lowered his price target from $23 to $22.

HSBC raised its rating from hold to buy, calling the sell-off a buying opportunity as it said growth in subscribers and earnings before interest, taxes, depreciation, and amortization (EBITDA) were solid, and that its fiber-optic upgrade is the right strategy.

Lastly, Deutsche Bank also called out the opportunity in the stock, saying the market is confused about the company's free cash flow (FCF) miss -- AT&T reported just $1 billion in FCF, down from $2.8 billion the year before, though that reflects seasonal trends the company experienced in 2022. Deutsche Bank was also confident the company can hit its target of at least $16 billion in FCF for the year.

Now what

Despite the weak FCF, AT&T maintained its guidance for the year, calling for adjusted earnings per share of $2.35 to $2.45 and FCF of $16 billion. 

Based on that forecast, the stock is trading at 7 to 8 times earnings, which is a low price, especially when combined with its 6.3% dividend yield.

However, that cheap price reflects a long history of poor execution and its massive debt burden, meaning the current price isn't the bargain it might seem.