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CenturyLink Expands Fiber Gigabit in Boulder to Meet Demand

Zacks Equity Research

CenturyLink, Inc. CTL completed the construction of a fiber-optic project that was started in 2019, connecting more than 14,000 additional homes in Boulder, CO to gigabit Internet speeds. The Monroe, LA-based communications company’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.

This project provides fast and reliable Fiber-to-the-Home (FTTH) Internet service with gigabit speeds to residents and enterprises. Fiber optic-based Internet services have been made by connecting fiber optic cable directly to homes and businesses using FTTH technology. CenturyLink’s fiber Internet services include quick upload and download speeds as well as the ability to support multiple users on multiple devices at the same time.

CenturyLink 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.

The company’s Fiber Gigabit provides the capacity required by customers. It connects people to work from home, distance learning, telemedicine and video entertainment, among others. Its fiber technology delivers symmetrical speeds allowing users to upload and download content at up to 940 megabits per second.

The technology offers enough power to simultaneously download music and movies, while gaming and streaming HD and 4K content. It can easily handle the demand of numerous connected devices in homes and businesses. Also, customers with Fiber Gigabit service will be able to back up a 16 GB smartphone in 2.27 minutes.

Through its global fiber network, CenturyLink provides services to meet the surging digital demands of consumers and businesses. The company intends to expand its network infrastructure in 20 cities this year, as it helps customers meet the increasing demand for high-speed connectivity.

However, due to uncertainties related to the COVID-19 pandemic, CenturyLink has withdrawn its 2020 financial outlook for adjusted EBITDA, free cash flow and capital expenditures.

Shares of CenturyLink have lost 5% against 4% growth of the industry in the past year. The stock is currently trading with a forward P/E of 7.3X.

CenturyLink has a dividend yield of 10.2% compared with 4.6% 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, Ooma, Inc. OOMA and Plantronics, Inc. PLT. While Turtle Beach and Ooma sport a Zacks Rank #1 (Strong Buy), Plantronics carries 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.

Ooma has a trailing four-quarter positive earnings surprise of 228.2%, on average.

Plantronics has a trailing four-quarter positive earnings surprise of 103.5%, on average. The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters.

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