NasdaqGS:FTR

Stock Analysis Report

Frontier Communications

Executive Summary

Frontier Communications Corporation provides communications services to consumer, commercial, and wholesale customers in the United States.

Rewards

Trading at 97% below its fair value

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year

Does not have a meaningful market cap ($69M)



Snowflake Analysis

Slightly overvalued with imperfect balance sheet.


Similar Companies

Share Price & News

How has Frontier Communications's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FTR's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-9.1%

FTR

0.4%

US Telecom

-1.3%

US Market


1 Year Return

-70.6%

FTR

15.6%

US Telecom

22.0%

US Market

Return vs Industry: FTR underperformed the US Telecom industry which returned 12% over the past year.

Return vs Market: FTR underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

FTRIndustryMarket
7 Day-9.1%0.4%-1.3%
30 Day-22.4%-1.3%1.6%
90 Day-44.1%0.6%8.9%
1 Year-70.6%-70.6%21.4%15.6%24.7%22.0%
3 Year-98.7%-98.9%18.4%1.1%49.4%39.7%
5 Year-99.2%-99.4%48.9%15.2%78.1%58.5%

Price Volatility Vs. Market

How volatile is Frontier Communications's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Frontier Communications undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FTR ($0.65) is trading below our estimate of fair value ($21.84)

Significantly Below Fair Value: FTR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FTR is unprofitable, so we can't compare its PE Ratio to the Telecom industry average.

PE vs Market: FTR is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate FTR's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: FTR has negative assets, so we can't compare its PB Ratio to the US Telecom industry average.


Next Steps

Future Growth

How is Frontier Communications forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

68.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FTR is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: FTR is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: FTR is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: FTR's revenue is expected to decline over the next 3 years (-4.9% per year).

High Growth Revenue: FTR's revenue is forecast to decline over the next 3 years (-4.9% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if FTR's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Frontier Communications performed over the past 5 years?

-64.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FTR is currently unprofitable.

Growing Profit Margin: FTR is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: FTR is unprofitable, and losses have increased over the past 5 years at a rate of -64.1% per year.

Accelerating Growth: Unable to compare FTR's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: FTR is unprofitable, making it difficult to compare its past year earnings growth to the Telecom industry (-43.1%).


Return on Equity

High ROE: FTR's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Frontier Communications's financial position?


Financial Position Analysis

Short Term Liabilities: FTR has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: FTR has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: FTR has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: FTR's has negative shareholder equity, so we do not need to check if its debt has reduced over time.


Balance Sheet

Inventory Level: FTR has a high level of physical assets or inventory.

Debt Coverage by Assets: FTR has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable FTR has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: FTR is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 21.7% per year.


Next Steps

Dividend

What is Frontier Communications's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage4.8%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate FTR's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate FTR's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FTR's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FTR's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: FTR is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FTR's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Frontier Communications's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Bernie Han (55yo)

0.08yrs

Tenure

0

Mr. Bernard L. Han, also known as Bernie, has been the President, Chief Executive Officer and Director at Frontier Communications Corporation since December 3, 2019. Mr. Han served as an Executive Vice Pre ...


Management Age and Tenure

2.0yrs

Average Tenure

54yo

Average Age

Experienced Management: FTR's management team is considered experienced (2 years average tenure).


Board Age and Tenure

1.1yrs

Average Tenure

60yo

Average Age

Experienced Board: FTR's board of directors are not considered experienced ( 1.1 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 20.7%.


Management Team

  • Bernie Han (55yo)

    President

    • Tenure: 0.08yrs
  • John Maduri (58yo)

    Executive VP & Chief Customer Officer

    • Tenure: 2.5yrs
    • Compensation: US$3.66m
  • Don Daniels (51yo)

    Senior VP & Chief Accounting Officer

    • Tenure: 2yrs
  • Steve Gable (45yo)

    Executive VP & Chief Technology Officer

    • Tenure: 4.8yrs
    • Compensation: US$2.39m
  • Luke Szymczak

    Vice President of Investor Relations

    • Tenure: 6.8yrs
  • Ken Arndt (54yo)

    Executive VP & COO

    • Tenure: 2yrs
    • Compensation: US$2.22m
  • Mark Nielsen (54yo)

    Executive VP

    • Tenure: 5.8yrs
    • Compensation: US$1.38m
  • Sheldon Bruha (51yo)

    CFO, Executive VP & Treasurer

    • Tenure: 1.3yrs
    • Compensation: US$715.47k
  • Javier Mendoza

    Vice President of Corporate Communications & External Affairs

    • Rob Curtis

      Senior VP & Chief Marketing Officer

      • Tenure: 1.8yrs

    Board Members

    • Pam Reeve (69yo)

      Independent Chairman of the Board

      • Tenure: 3.8yrs
      • Compensation: US$390.00k
    • Rob Schriesheim (58yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$11.69k
    • Bernie Han (55yo)

      President

      • Tenure: 0.08yrs
    • Kevin Beebe (60yo)

      Independent Director

      • Tenure: 0.6yrs
    • Peter C. Bynoe (69yo)

      Independent Director

      • Tenure: 12.3yrs
      • Compensation: US$230.00k
    • Diana Ferguson (55yo)

      Independent Director

      • Tenure: 5.3yrs
      • Compensation: US$215.00k
    • Mo Meghji (54yo)

      Independent Director

      • Tenure: 0.6yrs
    • Paul Keglevic (65yo)

      Independent Director

      • Tenure: 0.6yrs
    • Ed Fraioli (72yo)

      Independent Director

      • Tenure: 9.5yrs
      • Compensation: US$240.00k

    Company Information

    Frontier Communications Corporation's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Frontier Communications Corporation
    • Ticker: FTR
    • Exchange: NasdaqGS
    • Founded: 1927
    • Industry: Integrated Telecommunication Services
    • Sector: Telecom
    • Market Cap: US$61.304m
    • Shares outstanding: 105.37m
    • Website: https://www.frontier.com

    Number of Employees


    Location

    • Frontier Communications Corporation
    • 401 Merritt 7
    • Norwalk
    • Connecticut
    • 6851
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    FTRNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 1970
    YC51DB (Deutsche Boerse AG)YesCommon StockDEEURJul 1970
    0TP1LSE (London Stock Exchange)YesCommon StockGBUSDJul 1970

    Biography

    Frontier Communications Corporation provides communications services to consumer, commercial, and wholesale customers in the United States. It offers broadband, video, voice, and other services and products through a combination of fiber and copper-based networks to consumer customers. The company also provides Ethernet and traditional circuit-based services; software defined wide area network, managed Wi-Fi and cloud IT solutions, voice and Unified Communications as a Service (UCaaS), and Voice over Internet Protocol (VoIP) services, as well as hardware and network solutions and services to small and medium business, and large enterprises. In addition, it offers data and Internet services; wireless broadband services; satellite TV video services; voice services, including data-based VoIP, UCaaS, and long distance and voice messaging services; and a package of communications services. Further, the company provides a range of access services that allow other carriers to use facilities to originate and terminate their local and long-distance voice traffic. It serves approximately 4.5 million customers and 3.7 million broadband subscribers in 29 states. The company was formerly known as Citizens Communications Company and changed its name to Frontier Communications Corporation in July 2008. Frontier Communications Corporation was founded in 1927 and is based in Norwalk, Connecticut. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/26 00:16
    End of Day Share Price2020/01/24 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.