AP via Forbes:

An Oppenheimer analyst said Wednesday he is taking a more cautious stance on shares of rural local exchange carriers because of regulatory concerns.

Analyst Timothy Horan wrote in a note to investors that the Federal Communications Commission’s ongoing Universal Service Fund audit could affect rural carriers throughout the sector.

The service fund subsidizes phone service for rural and low-income customers through a surcharge on almost all long-distance bills. Horan said the FCC is conducting about 400 audits as part of the campaign, up from 50 last year.