TW Telecom Feels The Disconnect (TWTC)

By Douglas A. McIntyre Published Sep 9, 8:16AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

TW Telecom Inc. (NASDAQ: TWTC), the former Time Warner Telecom, is having a rough morning. Last night the company submitted an SEC filing showing that it was going to warn of slower revenue trends at an investor conference. The company said that it is still experiencing revenue pressure from disconnects from homeowners behind in their mortgages and from very small customers. The weakness in the Midwest is seeing a potential extension of the slowing economy in the Southeast and in individual markets in other regions. To add fuel to the fire, it is warning that it may experience a small business customer churn increase as it disconnects non-paying customers.

So far we are seeing two downgrades in the stock. Citigroup has takenits buy rating to a hold and Merriman Curhan Ford has cutits buy rating to neutral. Soleil has recently upgraded this stock, and both JPMorgan and Oppenheimer had cut their ratings last month.

This telecom provider is going to be opening on new 52-week lows as theprior range was $13.61 to $24.00. Shares are down 22% at $11.50 inearly pre-market trading. In regular trading it was down about 18 percent.

Before this drop its market cap was listed as still being almost $2.2 billion. Analysts were previously looking for $1.17 billion in 2008revenues and $1.27 billion next year. Those numbers are going to belower as of today’s data.

Jon C. Ogg
September 9, 2008

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.