U.S. Cellular downgraded to Underweight from Overweight at Wells Fargo

Wells Fargo analyst Eric Luebchow double downgraded U.S. Cellular to Underweight from Overweight with a price target of $20, down from $33. The analyst views the U.S. telecom sector as a relatively defensive play for 2023, saying wireless subscriber growth should remain above historical levels, fiber-to-the-home construction should still grow and fixed wireless should continue taking share. However, he recommends investors be selective given the current inflationary backdrop. Luebchow double downgraded U.S. Cellular saying the company’s service revenue and EBITA will be be squeezed by high promotional costs and continued phone net losses.