CenturyLink, Inc. CTL recently announced that it has expanded its Ethernet Services portfolio to provide improved connectivity for enterprise customers. The latest move underscores its commitment to delivering comprehensive advanced network services to global markets.
The communications company has added multipoint-to-multipoint capabilities to its Ethernet E-Services portfolio to help businesses simplify bandwidth requirements, while creating multinational Wide Area Networks to minimize costs.
CenturyLink’s global Ethernet Services platform delivers flexibility and scalability for customers to design their network. Its strong network capabilities include around 450,000 global route miles of fiber, with services in more than 60 countries and more than 150,000 on-net buildings.
Markedly, E-LAN boosts CenturyLink’s E-Services that provide point-to-point, point-to multipoint and multi-point network configurations. The solution is available in nearly 300 markets for on-net and off-net retail and wholesale customers. It offers major business benefits including security and customization.
CenturyLink's E-LAN can be used to connect multiple locations across Ethernet-enabled markets globally, regionally or in a single metro location. It leverages Software Defined Network capable network components and can be seamlessly configured with CenturyLink Cloud Connect Dynamic Connections, Dynamic Capacity and Enhanced Management solutions.
CenturyLink aims to transform its business operations through product evolution and digitizing of customer interactions. It is working toward generating healthy revenue growth in its markets. The company expects the scale of its global assets alongside innovative product portfolio to be accretive to earnings.
CenturyLink has long-term EPS growth expectation of 8.7%. However, the stock has incurred an average loss of 46% against the industry’s rise of 3.7% over the past six months. The downslide can be largely attributable to the company’s huge debt burden.
As of Mar 31, 2019, it had $441 million in cash and equivalents with $34,858 million of long-term debt. Accumulating financial obligation is a grave concern, causing volatility in earnings. It is to be seen if such coveted solution offerings to clients can help turnaround the company’s profitability in the near future.
Buoyed by a decent start in capturing synergy and cost transformation savings, CenturyLink reiterated its financial outlook for full-year 2019. It expects adjusted EBITDA of $9.00-$9.20 billion. While free cash flow is expected in the range of $3.10-$3.40 billion, free cash flow after dividends is projected between $2.025 billion and $2.325 billion.
Further, CenturyLink is committed to its de-leveraging objectives and reaching the target leverage range of 2.75x-3.25x (net debt-to-adjusted EBITDA) in the next three years owing to solid business fundamentals. It intends to return significant value to shareholders while investing in revenues and EBITDA growth drivers.
CenturyLink currently has a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader industry are T-Mobile US, Inc. TMUS, Ubiquiti Networks, Inc. UBNT and Juniper Networks, Inc. JNPR, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
T-Mobile has long-term earnings growth expectation of 15.1%.
Ubiquiti has long-term earnings growth expectation of 19.8%.
Juniper has long-term earnings growth expectation of 6.2%.
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