S&P Cuts Cable One's Credit Rating to 'B+' on Fierce Broadband Competition

S&P Global Ratings has downgraded Cable One Inc.'s (NYSE: CABO) issuer credit rating to 'B+' from 'BB-', pointing to a deteriorating business outlook amid aggressive competition. The ratings agency attributed the downgrade to rising pressure from fiber-to-the-home and fixed wireless access providers, which are weakening the cable operator's market position.

Competitive Pressures Erode Profitability

The rating action reflects what S&P calls a "fundamental weakening" in Cable One's business as competitors encroach on its territory. The company faces a dual threat from expanding fiber networks, which now overlap with over 60% of its footprint, and lower-priced fixed wireless plans offered for around $50 per month.

This competition makes Cable One's high average revenue per user of roughly $80 increasingly vulnerable. As a result, S&P projects the company's residential broadband penetration will fall from 33.5% in 2025 to approximately 28% by 2028. The financial impact is already evident, with first-half 2026 earnings before interest, taxes, depreciation, and amortization (EBITDA) falling 11.8% year-over-year, keeping leverage near 4.0x.

Ad

Acquisition and Debt Risks Loom

S&P has maintained Cable One's ratings on CreditWatch with negative implications, signaling a high probability of another one-notch downgrade to 'B'. This is tied to the company's pending acquisition of Mega Broadband Communications Investments (MBI), which is expected to close on Oct. 1.

The MBI transaction is projected to push Cable One's consolidated leverage into the low-5x range. S&P forecasts significant full-year 2026 earnings declines of 10% to 11% for Cable One and 15% to 16% for MBI. Beyond the immediate operational headwinds, the company faces a significant $2.3 billion debt wall maturing in 2028, which could present substantial refinancing challenges and prolong the negative CreditWatch status.