5 Stocks with the Largest Fair Value Estimate Cuts After Q2 Earnings

In an otherwise strong second-quarter earnings season, as profits rose at their fastest pace since 2021, some companies came up short, leading Morningstar analysts to slash their

. Of the 835 stocks under our coverage, 29 (3.5%) had their estimates cut by a meaningful 10.0% or more. That’s above the 10-year average of 2.5% but below last quarter’s 4.5%. On average, fair value estimates rose by 1.5%, below the first quarter’s 2.8% increase.

Stocks with the Largest Fair Value Estimate Cuts

1. Huya HUYA: $3.60 from $5.60
2. HubSpot HUBS: $300 from $450
3. Market Axess MKTX: $167 from $250
4. Cogent Communications CCOI: $17 from $25
5. Charter Communications CHTR: $280 from $400

A large decrease or increase in a stock’s fair value estimate may signal that a company’s fortunes are changing. However, for investors, it’s important to consider how a stock trades compared with that estimate. Huya, HubSpot, Cogent, and Charter each carry a 4-star Morningstar Rating, indicating that our analysts view them as attractively priced for long-term investors, even after the significant valuation reductions. MarketAxess has a 3-star rating, suggesting it is fairly valued.

Here’s what Morningstar’s analysts say about these stocks.

Huya

• Fair Value Estimate
  : $3.60
• Fair Value Decrease: 36%
• Economic Moat
  : None
• Morningstar Rating
  : ★★★★

“Huya’s revenue grew 11% year on year in the second quarter of 2026, driven by a 54% increase in game-related revenue, while net profit was around break-even. The firm doubled its buyback authorization to $100 million.

“The mix shift toward game services is delivering the margin uplift we have been modeling. However, Huya’s long-term earnings power appears capped: game services are exposed to hit-driven title risk, while livestreaming’s decline could accelerate.”

—Ivan Su, director of equity research

Investors can find more of Su’s take on Huya here.

HubSpot

• Fair Value Estimate: $300.00
• Fair Value Decrease: 33%
• Economic Moat: Narrow
• Morningstar Rating: ★★★★

“HubSpot reported second-quarter results that topped the high end of guidance on headline measures. Total revenue grew 17% year over year in constant currency to $912 million, while adjusted operating margin was 20.3%, and the outlook for the third quarter was disappointing.

“Second-quarter results were (mostly) good, but the outlook was disappointing. HubSpot made pricing, packaging, and go-to-market changes in April, while also experiencing an elongated sales cycle, both of which limited performance and hurt the outlook.”

—Dan Romanoff, senior equity analyst

The rest of Romanoff’s take on HubSpot can be found here.

MarketAxess

• Fair Value Estimate: $167.00
• Fair Value Decrease: 33%
• Economic Moat: Wide
• Morningstar Rating: ★★★

“MarketAxess’ otherwise mediocre earnings are being overshadowed by the news that it has agreed to be acquired by Intercontinental Exchange ICE. Net revenue decreased 6% from last year to $218 million while earnings per share fell to $1.91 from $1.93.

“Unsurprisingly, MarketAxess’ shares are trading sharply higher as Intercontinental Exchange has agreed to pay $167 per share in an all-cash deal for MarketAxess, a 33% premium to its July 29 closing price.”

—Michael Miller, equity analyst

Take a deeper dive into Miller’s outlook for MarketAxess.

Cogent Communications

• Fair Value Estimate: $17.00
• Fair Value Decrease: 32%
• Economic Moat: Narrow
• Morningstar Rating: ★★★★

“Cogent delivered a disappointing second quarter. Revenue declined 4.3% year over year and 1.5% sequentially, with weakness across customer types. EBITDA declined from a year ago, and free cash flow was negative, even with the payments from T-Mobile. Data center sales helped the balance sheet.

“We could look past weak growth given the ongoing decline of noncore legacy Sprint revenue, but key growth areas, notably wavelength services, were very disappointing. The number of net new wavelength circuits in service should be increasing each quarter, but it is actually falling.”

—Michael Hodel, director of equity research

Hodel has more about Cogent Communications stock here.

Charter Communications

• Fair Value Estimate: $280.00
• Fair Value Decrease: 30%
• Economic Moat: Narrow
• Morningstar Rating: ★★★★

“Our confidence in Comcast and Charter’s ability to maintain pricing discipline while stemming broadband customer losses has weakened. US cable firms showed no improvement in the first quarter, the FCC is preparing additional wireless spectrum for auction, and SpaceX poses an incremental threat.

“We have also increased our Uncertainty Rating on Charter to Very High from High. With Charter’s equity value shrinking sharply relative to its debt load, we expect share price volatility to remain elevated.”

—Michael Hodel

The rest of Hodel’s take on Charter can be found here.