Uniti Group (UNIT): Evaluating Valuation After Strategic MDC San Diego Expansion Boosts Cross-Border Network Connectivity

Uniti Group (UNIT) has drawn investor attention after unveiling an expansion of its wholesale business through a new partnership at MDC San Diego. The initiative boosts connectivity between the U.S. and Mexico and aims for stronger, more resilient cross-border fiber routes.

See our latest analysis for Uniti Group.

Uniti Group’s expansion at MDC San Diego has turned some heads, coming just as its share price staged a 6.2% rise over the past week. This is a rare bright spot in an otherwise tough year, with a total shareholder return of -34.1% over the last twelve months. While recent news signals growth ambitions and fresh momentum, the overall performance still reflects investor caution. However, any sustained uptick could hint at changing sentiment around the company’s long-term prospects.

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The market has taken notice, with Uniti’s share price still trading noticeably below analyst targets. Is this an overlooked value play, or is the market already factoring in the company’s expected growth from these bold moves?

Most Popular Narrative: 19.7% Undervalued

With the narrative fair value at $7.48 and shares last closing at $6.00, analysts see notable upside driven by recent business expansion and shifting financial expectations. Market watchers are weighing whether Uniti’s growth strategy can deliver on these projections.

Robust and expanding deal pipeline with hyperscalers ($1.5 billion in total contract value, 40% of sales funnel), along with rising lease-up opportunities and cross-selling with Windstream, is expected to drive higher-margin, low-capex, long-term contracts. This could boost EBITDA and net earnings as industry demand for bandwidth and low-latency networks escalates.

Read the complete narrative.

Curious how bullish projections for future earnings and growth margins translate into such a significant fair value bump? A handful of key assumptions are doing the heavy lifting. But only by reading the full narrative will you uncover what’s fueling this striking upside and whether the growth thesis is rock solid or built on shifting assumptions.

Result: Fair Value of $7.48 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent declines in legacy revenues or a spike in construction costs could quickly undermine optimism about Uniti Group’s expanding fiber ambitions.

Find out about the key risks to this Uniti Group narrative.

Another View: Multiples Tell a Different Story

Looking at Uniti Group's valuation through the lens of its price-to-earnings ratio paints a more cautious picture. At 42.1x, the ratio is considerably higher than both its peers (14.2x) and the broader global telecom industry (16.8x). Even when compared to the fair ratio of 14x, Uniti appears expensive. This gap highlights potential risks if the market shifts toward more typical valuation levels. Could these premium multiples be justified by growth, or is caution warranted?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Uniti Group Narrative

If you see things differently or want to dig deeper into the data on your terms, building your own view is quick and straightforward. Do it your way

A great starting point for your Uniti Group research is our analysis highlighting 2 key rewards and 5 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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