Along with its first-quarter results, which were uneventful as usual, Uniti announced an agreement to merge with Windstream, the company from which it was originally spun out. Consistent with Uniti’s modus operandi, the transaction appears to be financially complicated and opaque, which we suspect is behind the market’s negative reaction.
Uniti’s renegotiation of its Windstream lease gives the ability to add new leases to existing fiber, which can be very lucrative, as it requires little new spending.
Uniti is in a weak financial position, which at best impairs its ability to diversify its customer base and grow and at worst makes bankruptcy risk a constant threat.
|
Metric
|
UNIT
|
LUMN
|
VZ
|
|---|---|---|---|
Price/Earnings (Normalized) | 5.82 | 25.24 | 8.44 |
Price/Book Value | — | 2.58 | 1.76 |
Price/Sales | 0.83 | 0.09 | 1.24 |
Price/Cash Flow | 2.37 | 0.46 | 4.33 |
|
Metric
|
UNIT
|
LUMN
|
VZ
|
|---|---|---|---|
Quick Ratio | 0.12 | 0.77 | 0.52 |
Current Ratio | 0.13 | 1.03 | 0.71 |
Interest Coverage | 0.68 | −8.33 | 3.72 |
|
Metric
|
UNIT
|
LUMN
|
VZ
|
|---|---|---|---|
Return on Assets (Normalized) | 4.08% | −0.98% | 4.66% |
Return on Equity (Normalized) | — | −11.06% | 18.99% |
Return on Invested Capital (Normalized) | 17.64% | 3.01% | 7.89% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
AMT
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EQIX
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DLR
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CCI
| Crown Castle Inc | Trkb | Sdksfb | $42.3 Bil | |
IRM
| Iron Mountain Inc | Lbtcblvjs | Jldtjw | $23.3 Bil | |
WY
| Weyerhaeuser Co | Nqzrkqrw | Tjq | $22.7 Bil | |
SBAC
| SBA Communications Corp Class A | Mslnkdvp | Sbpqp | $21.2 Bil | |
LAMR
| Lamar Advertising Co Class A | Wfxclpsm | Trzlv | $12.2 Bil | |
GLPI
| Gaming and Leisure Properties Inc | — | Yhb | $12.0 Bil | |
RYN
| Rayonier Inc | Khlbwxbn | Plbfl | $4.4 Bil |
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