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A day after selling off due to a weak Q1 report, Frontier Communications (FTR -9.7%) plunged...

A day after selling off due to a weak Q1 report, Frontier Communications (FTR -9.7%) plunged again. Shares are now at multi-decade lows, as fears about the decay of the company's wireline voice base take their toll. Sean Williams points out Frontier shares now sport much lower multiples (and a much higher yield) than those of U.S. telco giants. Frontier is counting on the delivery of IP-based video services to help put an end to its revenue declines.
Comments (11)
  • untrusting investor
    , contributor
    Comments (9973) | Send Message
     
    Given the weakening earnings, they may not be able to maintain the dividends. Any reports on that?
    8 May 2012, 05:24 PM Reply Like
  • cforget
    , contributor
    Comments (20) | Send Message
     
    Too early too suggest that they would drop the dividend again. Based on conf call comments, sounds like they have turned a corner with completion of Verizon acquisition, but they are going to have to start showing decent earnings here on out or we'll be headed towards $2.00 and then we could start seeing another dividend reduction. They have to start walking the walk here soon or this thing could be on a slippery slope.
    8 May 2012, 05:44 PM Reply Like
  • davidanderson5033
    , contributor
    Comments (2) | Send Message
     
    It would be sad to think they would cut the dividend again. I think the real key to determining when things can start getting better is when the company is generating more cash than the payouts on the debt from the acquisition.

     

    This was supposed to happen in the first quarter but the acquisition was still weighing on cash flow.

     

    Has anyone been able to figure out where they are on this.?
    8 May 2012, 06:33 PM Reply Like
  • U Mass baseball
    , contributor
    Comments (26) | Send Message
     
    They did announce a .10 dividend today, payable on 6/30/12.
    9 May 2012, 01:07 AM Reply Like
  • ChesapeakeRay
    , contributor
    Comments (4) | Send Message
     
    Absent fraud, FTR is a great buy based on the factual profile of the company and its actions. Its credit rating was recently confirmed. Integration of the Verizon lines is nearly complete or finished....Marketing is now a clear field free of the conversions and will be the battlefield on which the future depends... One year from today FTR will be trading at a number greatly surprising all who stay the course.
    9 May 2012, 01:13 AM Reply Like
  • ricklcullen
    , contributor
    Comments (12) | Send Message
     
    The stock price is a proxy for managements credibility...
    9 May 2012, 01:19 AM Reply Like
  • Charles Santerre
    , contributor
    Comments (1242) | Send Message
     
    ricklcullen: what in your view has management done wrong, aside from saying the dividend was safe? Maybe at the time, they really thought it was. Otherwise, it could have serious implications.
    9 May 2012, 02:57 PM Reply Like
  • Griller
    , contributor
    Comments (151) | Send Message
     
    Management's acquisition was a mistake.
    9 May 2012, 07:39 PM Reply Like
  • Retiredtech
    , contributor
    Comment (1) | Send Message
     
    Paid way too much for VZ properties, both inside and outside plant were in poor (at best) shape. CAPEX spent on repair not upgrades for the most part! No clue as to taking over FIOS, and mgmt acknowledged that point. Why does mgmt and board continue to plan on a 7 + percent return on investment with retirement fund when in fact return in 2011 was just over 1 percent? How long are they going to ignore retirement funding issue?
    10 May 2012, 10:30 AM Reply Like
  • texas city
    , contributor
    Comments (10) | Send Message
     
    Retiredteck, You are correct. one thing i worry about is ..can they rebuild trust with the customers??? If they can`t do that ,they will be in the tank.
    10 May 2012, 06:16 PM Reply Like
  • diadochi
    , contributor
    Comments (252) | Send Message
     
    That assumes they have a choice. I'm not so sure that rural customers do any more.
    15 May 2012, 02:34 PM Reply Like
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