Nomura Securities Maintains a 'Buy' on Frontier Communications (FTR); Adjusting Estimates Mixed Quarter

August 1, 2012 10:07 AM EDT
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Price: $3.49 +0.29%

Rating Summary:
    14 Buy, 10 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Nomura Securities maintains a 'Buy' on Frontier Communications (NASDAQ: FTR) price target of $5.00.

Analyst, Mike McCormack, said, "This was a mixed quarter, with data revenue not growing as expected, but line-loss trends better than forecasted. We increased our 2012 revenue estimate from $4.92bn to $5.0bn on the better run rate in Other revenue, and raised free cash flow from $778mn to $831mn. Frontier’s 2Q revenue of $1.26bn came in ahead of our and consensus’ estimate of $1.24bn, mostly related to higher other. This drove the slight EBITDA beat, with the company reporting $605mn versus our and consensus’ estimates of $600. Free cash flow was $196mn, versus our estimate of $124mn, with much of the beat from core capital expenditures of $168mn versus our $196mn."

3Q12E EPS from $0.10 to $0.09; 4Q12E EPS from $0.10 to $0.09; F12E EPS at $0.31.

For an analyst ratings summary and ratings history on Frontier Communications click here. For more ratings news on Frontier Communications click here.

Shares of Frontier Communications closed at $3.92 yesterday.

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