T-Mobile Stock Plunges as Investors Worry About Subscriber Growth

T-Mobile US Inc. (TMUS) stock is headed for its worst week in six years after mixed fiscal second-quarter results. Despite better-than-expected earnings and a higher full-year cash flow forecast, investors are worried about slower subscriber growth due to recent pricing changes.

Goldman Sachs remains bullish on T-Mobile, citing improving cash flow and 35% upside potential. The firm increased its price target for the company to $230 from $224, despite concerns over slower Q3 subscriber additions.

T-Mobile added 277,000 postpaid accounts during Q2, but Goldman Sachs expects account additions to moderate to roughly 250,000 in Q3 due to pricing changes. CFO Peter Osvaldik acknowledged that these changes will likely weigh on subscriber additions during Q3, but reassured investors that the company still expects healthy customer growth for the full year.