Are Windstream Earnings Enough to Move the Needle?

Windstream Holdings Inc. (NASDAQ: WIN) reported its third-quarter financial results before the markets opened on Thursday. The company had a net loss of $0.13 per share on $1.5 billion in revenue, which compares to Thomson Reuters consensus estimates of a net loss of $0.34 per share on revenue of $1.47 billion. In the same period of the previous year, the company posted earnings per share (EPS) of $0.18 and $1.46 billion in revenue.

Windstream says it now expects fourth-quarter revenue in the range of $1.38 billion to $1.4 billion and capital expenditures in the range of $205 million to $230 million. Consensus estimates call for a net loss of $0.50 per share and $1.43 billion in revenue for the fourth quarter.

During the third quarter, Windstream repurchased 3.1 million shares for $20 million, or 25% of the $75 million share repurchase plan announced in August, which is expected to be completed by December 31. Additionally, the board of directors declared the regular quarterly dividend of $0.15 per share to shareholders of record as of December 31.

Earlier in October, Windstream announced the sale of its data center business for $575 million. The net proceeds from this transaction will enable debt reduction of roughly $300 million and fund Project Excel. That project is a $250 million program that accelerates Windstream’s plans to upgrade and modernize the company’s broadband capabilities by year-end 2016, or two years ahead of the previous timeline.

Tony Thomas, president and CEO of Windstream, commented on earnings:

The Windstream team is executing on all facets of our strategy and driving progress. Total revenue grew sequentially, excluding the incremental CAF-2 revenues received. We continue to see steady results in our Consumer and ILEC SMB units, and Enterprise revenue growth accelerated.

On the books, Windstream’s third-quarter cash and cash equivalents totaled $97.2 million, compared to $27.8 million at the end of December 2014.

Shares of Windstream closed Wednesday up nearly 3% at $6.38, with a consensus analyst price target of $7.44 and a 52-week trading range of $4.42 to $16.04.

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