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Zayo (ZAYO) to Augment Long Haul Fiber in UK to Meet Demands

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Zayo Group Holdings, Inc. recently announced that it is augmenting a new long haul fiber ring in the U.K. that will allow its customers to traverse the country through direct and low-latency paths. This move is in line with its strategy to expand fiber footprint globally while meeting the escalating demand from multiple tenants.

The project entails advanced, high-count and ultra-low loss fiber types and is built over the shortest physical paths. It will provide customers with maximum scalability and throughput, and is expected to be completed in less than 12 months. It involves 500-kilometer ring, including new build, which will provide access to the U.K.’s latest subsea cable crossings in both the Irish and North Seas. Also, the company will enhance the overall fiber count on its existing U.K. network and add two new unique routes, spanning from coast-to-coast, in order to complete the ring.

The project — the largest build undertaken by Zayo in Europe to date — is an example of its continued focus on European business. Its network extends across eight European countries and major cities and includes more than 1 million fiber kilometers. Zayo recently announced additional success-based metro expansions in London, Paris, Dublin and Amsterdam. The company’s continued expansion highlights its commitment to Europe and provides opportunity for customers who can benefit from its fiber network, data center footprint and extensive connectivity across global network.

Zayo expects a strong return on capital on these unique fiber routes, which will also be available for wavelengths. The company provides communications infrastructure solutions, including fiber and bandwidth connectivity, colocation and cloud infrastructure to the world’s leading businesses. Its 130,000-mile network in North America and Europe includes extensive metro connectivity to thousands of buildings and data centers.

Zayo remains enthusiastic about the prospects of its largest business segment, Fiber Solutions, as it is witnessing a very strong momentum. The stock has outperformed the industry with an average return of 19.7% compared with 16.7% rise of the latter in the past five years.



Zayo currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the industry include QUALCOMM Incorporated (QCOM - Free Report) , Ubiquiti Networks, Inc. and Juniper Networks, Inc. (JNPR - Free Report) . While Qualcomm and Ubiquiti sport a Zacks Rank #1 (Strong Buy), Juniper carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.               

Qualcomm has a long-term earnings growth expectation of 11.5%. It beat earnings in each of the trailing four quarters, the average being 18.5%.          

Ubiquiti has a long-term earnings growth expectation of 14%. It surpassed earnings estimates in three of the trailing four quarters, the average positive surprise being 11.3%.

Juniper has a long-term earnings growth expectation of 5.5%. It beat earnings estimates in each of the trailing four quarters, the average being 11%.          

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