Here's Why Cable One (CABO) Fell in Q2

Artisan Partners, an investment management company, released its “Artisan Mid Cap Value Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the quarter, the fund’s Investor Class fund ARTQX returned 0.26%, Advisor Class fund APDQX posted a return of 0.26%, and Institutional Class fund APHQX returned 0.33%, compared to a 5.35% return for the Russell Midcap Value Index. Equity markets experienced heightened volatility followed by the announcement and subsequent pause of the so-called "Liberation Day" tariffs. The portfolio underperformed in the quarter due to the market’s preference for growth and the outperformance of more cyclical sectors and industries. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Artisan Mid Cap Value Fund highlighted stocks such as Cable One, Inc. (NYSE:CABO). Cable One, Inc. (NYSE:CABO) is a US-based data, video, and voice services provider. The one-month return of Cable One, Inc. (NYSE:CABO) was 23.37%, and its shares lost 56.36% of their value over the last 52 weeks. On August 28, 2025, Cable One, Inc. (NYSE:CABO) stock closed at $157.89 per share, with a market capitalization of $888.761 million.

Artisan Mid Cap Value Fund stated the following regarding Cable One, Inc. (NYSE:CABO) in its second quarter 2025 investor letter:

"The communication services sector was another source of relative weakness, due largely to our investment in Cable One, Inc. (NYSE:CABO), a broadband provider in rural markets. CABO reported weak subscriber additions and a decline in ARPU (average revenue per user). Additionally, the company surprised investors by suspending its quarterly cash dividend. Our investment case has been predicated on CABO’s ability to grow subscribers given its premium offering and low penetration; however, Q1 2025 subscriber trends—the worst we’ve seen—have required us to reassess our thesis. The conditions causing low household formation are ongoing, fixed wireless and fiber competition continues to take market share, and most recently the company has execution issues rolling out a new billing system. In our view, these issues don’t fully explain the sudden change in subscriber trends from flat to down. Management largely sees the setback as temporary, and while it could be, management seems unrealistically bullish about its ability to turn trends around soon. This has been a painful case, and while the valuation still indicates a cheap security based on a variety of scenarios, the financial condition is now impeding the business and leaves management no room to operate the business strategically if conditions deteriorate further."

Cable One, Inc. (NYSE:CABO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Cable One, Inc. (NYSE:CABO) at the end of the second quarter, which was 29 in the previous quarter. Cable One, Inc.’s (NYSE:CABO) total revenues for the second quarter of 2025 were $381.1 million compared to $394.5 million in the second quarter of 2024. While we acknowledge the potential of Cable One, Inc. (NYSE:CABO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Cable One, Inc. (NYSE:CABO) and shared Atai Capital Management's views on the company. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.