Frontier Communications Corp. (NYSE: FTR) had already been a serial disappointment to investors. Having such a high double-digit yield based upon cash flow management rather than based upon a traditional earnings per share proved to be unsustainable. Now Frontier has capitulated by slashing its dividend by about 60%.

24/7 Wall St. has seen multiple analyst calls pointing to a coming dividend cut before it happened. unfortunately, many of those same analysts tried to keep a positive view when Frontier shares kept drifting lower and lower.

In fact, Frontier shares were recently trading at more than a decade-low. Wednesday’s reaction took Frontier Communications shares down another 14% to $1.65. Its prior 52-week low had been $1.81 before this drop, and Frontier shares traded as low at $1.63 on Wednesday.

After the cut, Jefferies has maintained a Buy rating but it slashed the price target down to $2.00 from $3.50. The firm said:

The magnitude of the dividend cut was greater than expected, but it is likely the prudent approach given balance sheet and operational challenges. While this may limit upside in the near-term for yield seekers, we still see compelling total returns amid a more confident outlook of operational stabilization. CTF revenue trends improved meaningfully, and strong gross adds provide optimism should management solve churn challenges.

UBS has downgraded Frontier to Neutral from Buy, in a fresh call.

Citigroup issued a surprise upgrade on Frontier with a rating raised to Neutral from Sell.

Also after the dividend cut, Frontier was downgraded to Market Perform from Outperform and the target price was slashed down to $2 from $4 at Cowen & Co.

S&P’s CFRA maintained a Hold rating on Frontier after earnings, but it slashed the price target down to $2 from $4 in the call. Its report widened out an expected 2017 loss per share estimate to -$0.26 from -$0.19 and 2018 to -$0.10 from a -$0.09. The CFRA report noted:

We view Frontier’s decision to reduce its annual dividend to $0.16 per share from $0.42 as a major disappointment. We see greater focus towards reducing its leveraged debt position but negatively view elevated consumer churn.

Moody’s has also chimed in after the dividend cut and said that Frontier’s dividend cut does not impact its rating or negative outlook.

A week ahead of earnings, JPMorgan said that they were expecting Frontier to slash its dividend payout by as little as 50% and as much as 90%. Their view was that a 90% dividend cut would be needed in an effort strong enough to drive down leverage as the best outcome for Shareholders.

Back on April 11, Macquarie maintained a Neutral rating but lowered its target to $2.65 from $3.40. Its report at that time was after a $2.08 close and it said:

Frontier is at a critical point. At a ~20% yield, we believe a near-term cut to the dividend could be a positive catalyst to the stock. Beyond that, we believe it’s mission critical that sub trends stabilize and that the company delevers. We think both are important to instill confidence in investors on the sustainability of the model.

Frontier Communications now has a 52-week range of $1.63 to $5.53 and the market cap is now $1.95 billion.

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