CenturyLink, Inc. (NYSE: CTL) is a telecommunications company that offers internet and communication services to commercial and residential clients. The company was established in 1930 with its headquarters in Los Angeles. It operates through two segments: the Consumer and the Business. CenturyLink provides services such as long-distance voice services, broadband, VPN data networks, network security, and data center services.
The company runs several high-value network assets across greater markets including the US. One and a half years ago, CenturyLink acquired Level 3 Communications asset. The asset closed in late 2017 at a value of $34 billion. All these, and a steady performance running through 2019 shows that CenturyLink has a solid prospect for anyone who wants to invest in a stock that promises strong and steady returns.
The Dividend Outlook
The CenturyLink, Inc. (NYSE: CTL) paid the investors a dividend of $2.16 per share. Now, the new pay rates are at $1.00. This is a drop from a total $2.3 billion to $1.08 billion. Still, that dividend yield is handsome. And the beauty of it all is that it’s sustainable. During its first quarter, the company generated revenue of $5.78 billion, showing a 3.7% drop compared to the same period last year. The company decided to exit the low profitability or low margin businesses. The move further caused a significant drop in revenues. Despite the setbacks associated with the move, experts believe that it was a tactical and clearly good move. CenturyLink is now focusing its resources on more profitable ventures. If the new plan works well for the company, which is expected, the dividends yield is set to get better. Additionally, as an internet and telecom service provider, there is expansive room for growth both in the short and long term.
The Stock Performance
Among the factors that play a role in high dividend yield and profitability are the stocks. The CTL stocks are currently trading at a ratio of 8.61, in comparison to the industry’s 11.88. Considering the CTL’s strong cash flow, its stocks are of high value and worth investing in. Analysts put the mean target price for the stock at $12.83, which is an uptick compared to the stock’s current price. At the moment, the stock is trading at around $11.46. Over the past month, CTL has had a high of $12.26 and a low of $10.91.
Generally, those who’re keen on buying with the focus on long term earnings, CenturyLink, Inc. (NYSE: CTL) is a yummy investment.