10 Worst Communication Services Stocks to Buy According to Short Sellers

4) Altice USA, Inc. (NYSE:ATUS)

Short % of Float (15 August 2024): 15.94%

Number of Hedge Fund Holders: 32

Altice USA, Inc. (NYSE:ATUS) operates as a telecommunication and media company. It provides digital cable television, high-speed broadband and ultra-HD video, internet, local news and voice offerings, and digital advertising solutions.

In early 2024, Bloomberg reported that criminal investigations in Portugal and France impacted this telecommunications empire. The investigations into suspected corruption, money laundering, and tax fraud led to the suspension of around a dozen executives and 60 suppliers in Portugal, France, and the US.

The company mentioned that it has become a victim of alleged wrongdoings. Portuguese prosecutors mentioned that procurement decisions that were taken at Altice Portugal were rigged in such a way that harmed the group’s own companies and competitors. However, these decisions benefited intermediaries via corruption, tax fraud, and money laundering. As a result, contracts with ~60 of the company’s suppliers globally were scrutinized. On the YTD basis, Altice USA, Inc. (NYSE:ATUS)’s stock has seen a decline of more than ~30%, and its short % of float (as of 15 August 2024) stood at ~15.9%.

Wall Street analysts believe that the new management team of Altice USA, Inc. (NYSE:ATUS), which largely hails from Comcast, is focused on improving the firm’s performance. The expansion into the B2B offerings should fuel growth prospects, with additional support likely to come from political revenue in 2H 2024. This should help achieve advertising growth. Altice USA, Inc. (NYSE:ATUS) continues to focus on making investments in AI and data to enhance capabilities and customer service.

Its efforts to improve customer experience and operational efficiency via investments in fiber expansion, mobile services, and AI build a growth story for the long term. Its proactive network maintenance and segmented go-to-market approach should result in operational improvements. Altice USA, Inc. (NYSE:ATUS) elevated its product and network quality and introduced refreshed go-to-market strategies, which should continue to gain traction.

In 2Q 2024, Altice USA, Inc. (NYSE:ATUS) achieved significant improvements in operational metrics and customer satisfaction, and growth in fiber, mobile, and B2B businesses. It also saw continued stabilization of ARPU throughout the base.

The average price target for the shares of Altice USA, Inc. (NYSE:ATUS) stood at $2.61. This is based on 9 Wall Street analysts’ 12-month price targets, which were issued over the previous 3 months. The average price target demonstrates an upside of ~18.64% from the current price of $2.20. As per Insider Monkey’s database, 32 hedge funds were long Altice USA, Inc. (NYSE:ATUS), up from 27 in the preceding quarter.