Home » Broadband Speed »Competition »Consumer News »Frontier » Currently Reading:

Frontier: Nothing to See Here; 3rd Quarter Results Cause Share Price to Plummet to New Low

Phillip Dampier November 1, 2017 Broadband Speed, Competition, Consumer News, Frontier No Comments

Frontier’s stock has reached the lowest level of the year after another disappointing earnings report.

Frontier Communications turned in lackluster numbers for the third quarter of 2017, resulting in a wide selloff of Frontier’s stock, driving it to the lowest level it has seen in a year.

Investors are reacting to news the company missed earnings estimates once again, and many are losing confidence in Frontier’s CEO Daniel McCarthy, who has promised better results for more than a year. Frontier is rare among broadband providers, losing customers in virtually every segment of its business, including in its acquired FiOS service areas.

Frontier’s stock has lost more than 80% of its marketplace value so far this year — a stunning decline for a company selling broadband service in many areas where it maintains a monopoly.

McCarthy once again made a commitment his efforts will “stabilize” customer losses, but spent most of his time trying to reassure investors on a Tuesday conference call that those stabilization efforts will primarily target areas where Frontier sells FiOS fiber to the home service. Customer churn continues to be a problem, with many customers leaving either because the company alienated them or dramatically raised their rates after a discounted promotion expires. Either way, many of those customers switch back to a cable provider. McCarthy claimed Frontier plans to adjust promotional pricing to soften the blow of a steep rate hike after a promotion expires.

McCarthy said almost nothing about Frontier’s legacy service areas, where Frontier still sells copper-based DSL service. Some of the company’s biggest losses have been in areas where it cannot compete effectively with cable broadband. McCarthy offered to enhance customer retention efforts and increase marketing to reduce losses, but there are no indications Frontier plans to spend significantly on major network upgrades in these areas anytime soon.

Frontier declared an unexpected dividend of $0.60 a share, which some analysts consider excessive and represents a “red flag atop this toxic value destroyer.”

One analyst remarked, “I’m not buying it; Frontier is a business in free fall.”







Search This Site:

Contributions:

Recent Comments:

  • George: The Public Service Commission should rescind the merger of Charter and Time Warner. Spectrum is GREATLY overcharging NOW!!!...
  • BobInIllinois: Correction to above: MetroNet so far has 3 SW Chicago suburb retail offices in Oswego, Plainfield, and Romeoville, IL....
  • BobInIllinois: Thanks for the MetroNet financial info above. Detecting a private equity trend in these fiber overbuilders. Overbuilders seem to be interested in sm...
  • msexceptiontotherule: Something tells me that transparency isn't Pai's top priority. Just when it seems like things are slightly not terrible......
  • MarkLex: I live in Lexington and I actually have had Windstream for years and it's very consistent. But this is awesome. More competition!!...
  • Ian L: MetroNet's prices aren't too bad, honestly. Sure, they're not the $55 Google is charging for gigabit in San Antonio. But you can also get TV from them...
  • JayS: "Pai’s proposal would require internet service providers to disclose whether they allow blocking or slowing down of consumer web access or permit so-c...
  • Josh: sigh Of course he does. Elections have consequences, people......
  • kaniki: I would say, as a whole, most places really only have one option. Especially in rural areas.. The only places that will usually have at least 2, will ...
  • kaniki: Trust me, I know this.. Look at the current merger / takeover / buyout in alaska.. They are charging something like $180 to get unlimited internet at ...
  • EJ: As I have stated before if these companies are smart they will collaborate together and make it clear that if net neutrality is reversed they will col...
  • EJ: I think you are confused on what Net Neutrality really is. It is not about ads, it is about the ability for your provider to control the bandwidth bas...

Your Account:

%d bloggers like this: