UBS Maintains a 'Neutral' on Windstream (WIN); Higher Capex Outlook to Pressure 2012 FCF

UBS maintains a 'Neutral' on Windstream (NASDAQ: WIN) price target lowered $1 to $12.00.

UBS analyst says, "2011 outlook in tact; FCF pressure in 2012: Based on YTD results and commentary for 4Q, we expect WIN to come in at the mid-point of its rev target and low-end of EBITDA & FCF target in 2011. Mgmt expects to spend an incremental $75-100M to drive fiber to 90% of its in-region towers and $50M in BB stimulus projects in 2012. While this should help revenues longer term, we expect EBITDA to see near-term pressure. We expect EBITDA (exc. PAET) of ~$2.0B in 2012 to be offset by $760M in capex, $500M of cash i.nterest, leaving $715M in FCF, down 14% yoy, driving div payout to 72%."

For more ratings news on Windstream click here and for the rating history of Windstream click here.

Shares of Windstream closed at $11.85 yesterday.

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