THIS IS NOT INVESTMENT ADVICE. IT IS A PERSONAL REFLECTION ON INVESTING. RELY ON NOTHING STATED HEREIN
As reported in Vol 38, I am a fan of Frontier Communications (FTR) and awaited its quarterly analysts call to make a decision on my positions. My June buy is up 25% and my September buy is up 12%. This quarter was the first since the integration of Verizon's land line business which tripled the size of FTR. Many analysts were of the mind that FTR's management was not up to the task of integrating that business. They appear to have had it wrong. I just finished reading the transcript of today's call. Although the forward cap ex is higher than I would like, the synergy savings are way up. Dividend coverage is 55% of free cash flow, well within my safety zone, and the CFO stated unequivocally that the company was "very committed" to maintaining the $0.75 dividend which based on today's close of $9 equates to a 8.3% return. This dividend looks secure for the foreseeable future and I am a buyer tomorrow. I could see FTR trading at $11 which would put its dividend rate on parity with CenturyLink (CTL).
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