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Investing.com -- KeyBanc downgraded T-Mobile US (NASDAQ:TMUS) to Underweight from Sector weight given concerns over its lack of fiber infrastructure, rising competitive pressure, and a weakening value proposition for consumers.
It has a $200 price target on the stock, implying downside from current levels, and said it expects T-Mobile to miss expectations in the second quarter due to softer subscriber additions and higher device subsidies.
T-Mobile, which has outpaced rivals in postpaid phone net additions in recent years, is now at a strategic disadvantage in a telecom market increasingly centered around bundled mobile and home broadband offerings, KeyBanc said.
The firm pointed to accelerating fiber deployments by AT&T (NYSE:T), Verizon (NYSE:VZ), and cable players like Comcast (NASDAQ:CMCSA) and Charter, which could erode T-Mobile’s competitive position.
While T-Mobile plans to reach 12 million to 15 million fiber homes by 2030, KeyBanc said that timeline lags far behind competitors.
AT&T and Verizon, for instance, are expected to reach 60 million and 40 million fiber homes, respectively, while Comcast and Charter collectively cover more than 120 million homes with hybrid fiber-coaxial or fiber.
KeyBanc also flagged a more difficult macro backdrop, with elevated churn, weaker net subscriber additions, and increased pricing pressure across the wireless industry.
It forecasts T-Mobile will add 696,000 postpaid phone customers in the second quarter, below the 716,000 consensus estimate, and expects adjusted EBITDA to come in just shy of Wall Street forecasts.
With the stock trading at a premium to peers on 2026 EBITDA estimates, the firm questioned whether T-Mobile still merits such a valuation given slowing growth and limited fiber reach.