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CenturyLink Reaffirms Focus on Fiber Builds to Drive Growth

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CenturyLink, Inc. has expanded its fiber network in many parts of the country. The Monroe, LA-based communications company plans to sustain growth by bringing faster Internet speeds to additional homes and businesses in multiple cities. CenturyLink’s fiber and IP-based network capacity along with its financial strength positions it well to support customers and boost shareholders’ value in the long term.

The company is focused on the execution of its strategies that hinges around four key areas — investing in growth through product and network expansions, delivering enhanced customer experience across business, transforming operations to improve efficiency and employee experience as well as deleveraging to strengthen its balance sheet.

CenturyLink enabled around 300,000 homes and small businesses with faster Internet speeds in 2019. This includes the delivery of gigabit speeds in select areas of Boulder, CO; Spokane, WA; and Tucson, AZ. The company anticipates bringing gigabit speeds to 400,000 additional households and enterprises in various cities. The list includes Denver, CO; Idaho Falls, ID; Omaha, NE; and Phoenix, AZ, among others.

The company has also expanded its network infrastructure in eight cities, connecting technology corporations, start-ups and data centers to its fiber network. In 2019, it connected about 18,000 buildings to its scalable global network. The network expansions and capital investments underscore CenturyLink’s commitment to deliver a reliable connection to businesses that need a robust infrastructure to unlock new opportunities.

Through its global fiber network, CenturyLink provides services to meet the growing digital demands of businesses and consumers. The company plans to expand its network infrastructure in 20 cities this year, as it helps enterprise businesses meet the growing demand for high-speed connectivity. Due to uncertainties related to COVID-19, CenturyLink has withdrawn its 2020 financial outlook for adjusted EBITDA, free cash flow and capital expenditures.

Shares of CenturyLink have lost 35.5% compared with 10% decline of the industry in the past six months. The stock is currently trading with a forward P/E of 7X.



CenturyLink has a dividend yield of 10.3% compared with 4.7% of the industry. The company has a long-term earnings growth expectation of 6% compared with the industry’s 8.8%.

CenturyLink currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader industry are Turtle Beach Corporation (HEAR - Free Report) , Plantronics, Inc. and Ooma, Inc. (OOMA - Free Report) . While Turtle Beach sports a Zacks Rank #1 (Strong Buy), Plantronics and Ooma carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Turtle Beach has a trailing four-quarter positive earnings surprise of 46.4%, on average.

Plantronics has a trailing four-quarter positive earnings surprise of 27.7%, on average. The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters.

Ooma has a trailing four-quarter positive earnings surprise of 124%, on average.

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