Keybanc Downgrades T-Mobile US to Underweight with $200 Price Target

Keybanc analyst Brandon Nispel downgraded T-Mobile US (TMUS) to "Underweight" from "Sector Weight" on July 9, 2025. The price target remained unchanged at $200.00. The downgrade reflects Keybanc's revised assessment of the company's stock performance. Based on analyst estimates, the average target price for TMUS is $266.45 with a high estimate of $305.00 and a low estimate of $200.00.

KeyBanc Capital Markets analyst Brandon Nispel downgraded T-Mobile US (TMUS) to "Underweight" from "Sector Weight" on July 9, 2025. The price target remained unchanged at $200.00. The downgrade reflects KeyBanc's revised assessment of the company's stock performance, with the average target price for TMUS currently standing at $266.45, ranging from $200.00 to $305.00 [1].

The downgrade is primarily driven by concerns over T-Mobile's lack of fiber infrastructure, increasing competitive pressure, and a weakening consumer value proposition. KeyBanc believes that T-Mobile's strategic disadvantage in a telecom market increasingly centered around bundled mobile and home broadband offerings could erode its competitive position [1].

KeyBanc pointed out that T-Mobile plans to reach 12 million to 15 million fiber homes by 2030, which lags significantly behind competitors like AT&T and Verizon, who are expected to reach 60 million and 40 million fiber homes, respectively. Additionally, cable players such as Comcast and Charter cover more than 120 million homes with hybrid fiber-coaxial or fiber [1].

The research firm also cited near-term macroeconomic and competitive pressures that could limit T-Mobile's upside potential. KeyBanc expects T-Mobile to add 696,000 postpaid phone customers in the second quarter, below the 716,000 consensus estimate, and anticipates adjusted EBITDA to come in just shy of Wall Street forecasts [1].

Despite maintaining strong financial health with a 63.85% gross profit margin and revenue growth of 5.31% over the last twelve months, T-Mobile's premium valuation of approximately 9.5 times its 2026 adjusted EBITDA estimates was considered excessive by KeyBanc [2]. The firm questioned whether T-Mobile still merits such a valuation given slowing growth and limited fiber reach.

KeyBanc's downgrade comes amidst recent analyst concerns and a decline in T-Mobile's shares, partly due to concerns over high industry activity affecting margins and potential CEO succession issues. However, other analysts have maintained or upgraded their ratings on T-Mobile, citing its ability to navigate industry challenges and expand in rural markets [2].

References:
[1] https://www.investing.com/news/stock-market-news/tmobile-downgraded-by-keybanc-on-fiber-shortfall-competition-risks-4128207
[2] https://www.investing.com/news/analyst-ratings/keybanc-downgrades-tmobile-stock-to-underweight-on-fiber-concerns-93CH-4127468