S&P/ASX 200 Index (ASX: XJO) telco stocks have seen mixed share price movements throughout 2026. Some have climbed higher, some have remained relatively consistent and stable, while others have tumbled to fresh lows.
Chorus Ltd (ASX: CNU) is one that hasn't fared so well.
Through the first eight months of the year, shares in New Zealand's largest fixed-line communications infrastructure company barely wavered. But in late August, the ASX 200 telco stock hit a wall, and its shares started tumbling.
At the close of the ASX on Wednesday afternoon, the telco shares were down 20% from that turning point, and down 22% for the year to date to a 52-week low of $6.34 apiece. It's also the lowest closing point the shares have traded at since June 2022.
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What happened to the ASX telco stock in August, and why hasn't it rebounded?
The shares fell around 7% immediately following the company's FY26 results announcement late in the month.
The company announced a 1.5% increase in its operating revenue, a 3% lift in its EBITDA, and NPAT exploded to $37 million for the 12-month period, up from $4 million in FY25. That's around an 825% increase.
The telco also announced lower operating expenses, down by around 2% to $303 million, and hiked its total dividend payment up 4% to 60 cents per share.
The result looked good on paper, so why did investors suddenly sell up?
Looking closer at the results, it's likely that the telco's $3.17 billion in net debt overshadowed its positive NPAT result for the year. That puts the company's net debt at 4.37 times its EBITDA.
Since that initial share price fall, the shares have continued declining and are now down around another 7% at the time of writing.
There hasn't been any price-sensitive news out of Chorus since its results announcement in August, so the continued share price decline is most likely a result of dwindling investor confidence about the company's financial health.
Is this 52-week low the new normal for Chorus shares, or can they climb higher?
It looks like analysts are a little concerned about the results, too, although analyst forecasts suggest a rebound is most likely in the works following the latest share price slump.
TradingView data shows that analyst outlooks are mostly neutral on the ASX 200 telco stock over the next 12 months. Out of seven analysts, three have a hold rating, two have a buy rating, and two rate the shares a sell/strong sell.
But they all agree the shares have run below fair value and are due to climb higher.
The average target price is $7.63, which implies an upside of around 21% at the time of writing. Even the minimum $6.87 target price suggests the shares could climb roughly 9% from the trading price at the time of writing.
The company used a huge amount of capital to build out its nationwide fibre network, but that's now complete. I expect that at its next results announcement, we'll see a huge improvement in its heavy net debt, and that will help to drive a resurgence of investor confidence in its shares as it moves to its next phase.
