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Wall Street’s Take on CenturyLink Leading up to Its 1Q16 Earnings

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Analysts’ recommendations for CenturyLink

In the previous part of the series, we looked at CenturyLink’s (CTL) value-centric proposition in the telecommunications (telecom) industry in the United States.

We also looked at the forward dividend yields and forward EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) of CenturyLink and other key players in the US wireline space. These included AT&T (T), Verizon (VZ), and Frontier Communications (FTR).

Now let’s look at some market-centric measures for CenturyLink. Here, we’ll start with Wall Street’s views on CenturyLink as of April 11, 2016.

As we can see in the chart above, ~52.6% of Wall Street analysts’ recommendations for CenturyLink’s stock were “holds,” and 15.8% of recommendations were “sells” as of April 11. The remaining ~31.6% of analysts’ recommendations were “buys.”

The median target price set by analysts for CenturyLink was $29 as of April 11. The company’s closing price was $32.08 as of the same date.

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CenturyLink’s price performance

As of April 11, 2016, CenturyLink’s stock price had risen significantly by ~37.1% in the trailing-three-month period. Meanwhile, during the past month, the stock’s price performance was also in the positive territory. It rose by ~0.7%.

For diversified exposure to select US telecom companies, you may want to consider investing in the SPDR S&P 500 ETF (SPY). SPY held a combined total of ~2.8% in AT&T (T), Verizon (VZ), CenturyLink (CTL), Frontier Communications (FTR), and Level 3 Communications (LVLT) at the end of March 2016.

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