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:

  • FredH: @Nick - it sounds like you were a previous Charter/Spectrum customer, not a former TWC customer - correct? If so, that's a totally different scenario...
  • Homeslice: Myself and many of you on here have been waiting for Charter to upgrade the speed as they had stated a while ago. I ended up finding this site that b...
  • Phillip Dampier: There are third party companies selling Russian language channels in the U.S. Russia TV Company claims to offer over 200 Russian Federation TV and rad...
  • Phillip Dampier: Thanks for the tip....
  • Phillip Dampier: Oh how clever they are. They want you to abandon the old $14.99 TWC Everyday Low Price internet plan to qualify for this. I wouldn't take this deal if...
  • jeff: if u tell the system u want to be a new customer it will let u add the choice option after selecting internet only. if current customer with tv it do...
  • EJ: Kaniki we all know what is happening. They charge that because they can. In most areas there one competitor is inferior so they can charge to much and...
  • Todd: And 300M to Charter/Spectrum is peanuts. They increased ELP Internet from $14.99 to $19.99. I'm not a math major, but let me see if I have this righ...
  • Todd: I got called with this offer yesterday, actually. The problem with this, is yes, at $22, it seems like a good deal, and I'd almost consider it. Exce...
  • Quinn: Spectrum is awful. I very much preferred dealing with them when it was just Time Warner. At least if I spent some time I could get myself a good promo...
  • kaniki: and yet, they still do nothing about the things that people need more.. Like an internet service that they can afford.. Cable is a luxury, but, a lot ...
  • L. Nova: In the long run it is cheaper for CenturyLink to partner with streaming providers Netflix, Amazon, Sling TV & HULU and the hardware streaming box ...

Your Account: