Shares of AT&T fell 0.9% to $34.65, while T-Mobile shares dropped 3.3% to $32.26 on Friday following the announcement.
The new AT&T promotion will offer a promotional card of up to $250 for any T-Mobile smartphone new customers trade in. Trade-in values vary by device, and the credit is only usable toward AT&T devices and services. AT&T offers an additional $200 credit when former T-Mobile customers sign up for a new AT&T Next plan, buy a new device at full retail price, or activate a device they already own.
AT&T's promotion comes a week before T-Mobile is expected to offer credit to offset the cost of early termination fees for those who switch carriers before their two-year contracts are done. This promotion is a chance for AT&T to retaliate before T-Mobile CEO John Legere announces his company's plan.
TheStreet Ratings team rates AT&T INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about its recommendation:
"We rate AT&T INC (T) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow."