Frontier Dividend Cut Trumps Earnings (FTR)
Frontier Communications Corporation (NYSE: FTR) is paying a price for its earnings report decision. As the stock screened out with an unusually high double-digit dividend yield, it was one which could not likely be sustained. The new rate is $0.10…
Frontier Communications Corporation (NYSE: FTR) is paying a price for its earnings report decision. As the stock screened out with an unusually high double-digit dividend yield, it was one which could not likely be sustained. The new rate is $0.10 per share per quarter, generating a dividend yield of almost 9%, and the prior payout was $0.1875.
The company called it the strongest revenue growth since closing an acquisition and cash flow for 2011 was $1.1 billion. Normalized earnings came in at $0.07 EPS or $69 million outside of one-time costs. Revenue for the fourth quarter of 2011 was $1.283 million as compared to $1.29 billion in the prior fourth quarter. Thomson Reuters had estimates of $0.05 EPS on $1.27 billion in sales.
Here is the customer roster:
- 3,103,800 residential customers
- 309,900 business customers
- grew high-speed internet customers by 9,300 to 1,764,200
- 557,500 video customers
Shares of Frontier closed up 3.5% on the day but the stock is down over 5% at $4.22 in the after-hours session. Its 52-week trading range is $3.81 to $9.48,
Cutting a dividend is rarely good, but investors probably were expecting a cut of some sort.
JON C. OGG
Contact [email protected] for any questions or corrections.
Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.
