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How Frontier Compares in the Telecom Space

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Frontier’s scale

As of May 23, 2017, AT&T (T) was the largest US telecom player, with a market capitalization of ~$235.5 billion, followed by Verizon (VZ) at ~$185.5 billion. In the US wireline space, Frontier Communication (FTR) had a market capitalization of ~$1.6 billion. Meanwhile, Windstream (WIN) and CenturyLink (CTL) had a market capitalization of ~$0.9 billion and ~$13.8 billion, respectively.

Frontier was trading at a forward EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiple of ~5.4x as of the same date. Windstream and CenturyLink had similar EV-to-EBITDA multiples, of ~5.7x and ~5.7x, respectively.

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Bollinger Band

Frontier’s stock price closed at $1.40 on May 23, 2017. This price is close to its Bollinger Band midrange of $1.51, which implies that the stock is neither oversold nor overbought.

Moving average convergence divergence

Moving average convergence divergence (or MACD) is a momentum indicator derived by subtracting the 26-day exponential moving average (or EMA) from the 12-day EMA. A negative figure reflects a downward trend, and a positive figure reflects an upward trend. The company has registered an MACD of -0.19 in the last 14 days. In the next article of this series, we’ll look at analysts’ recommendations for Frontier stock.

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