AT&T CEO John Stankey thinks his stock's 5%-plus dividend yield could look juicy as interest rates decline and investors hunt for income.

"We have a very attractive dividend out there on our stock. And when interest rates start to go down, our dividend even looks all that much better," Stankey told Yahoo Finance at the Goldman Sachs Communacopia and Technology Conference on Tuesday.

AT&T's second quarter showed a business that would warrant attention even if interest rates weren't headed lower.

Total revenue fell 0.4% from the prior year to $29.8 billion. Adjusted operating profits declined slightly. The company notched 419,000 postpaid phone net additions. Mobility services sales rose 3.4%. Fiber net additions tallied more than 200,000 for the 18th straight quarter.

The company reiterated its full-year guidance ranges. It also hinted at a more robust capital return program in 2025 as it continues to make progress paying down a hefty debt pile.

Total debt stood at $130.6 billion at the end of the second quarter.

Shares of AT&T are up 30% year to date, against a 15% gain for Verizon (VZ) and 21% gain for T-Mobile (TMUS).

"We like AT&T’s scaled and differentiated convergence strategy which positions the company well for long-term market share growth," JPMorgan analyst Sebastiano Petti said in a client note.

Petti has an Overweight rating on AT&T's stock and has it on the firm's top idea list.

Stankey said he is closely watching the direction of interest rates as his customers and employees continue to battle inflationary pressures.

"I'm not a Fed expert, but I think I understand why the Fed is where they are. If I were in their shoes, making sure inflation was in check would've been absolutely the first priority," said Stankey.

"I see the effects every day. I look at what's going on within our workforce and people who earn their money every day and, you know, I went to the store last weekend and picked up some stuff and I'm surprised at the prices of some things."

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