Analyst Eric Luebchow of Wells Fargo maintained a Hold rating on Lumen Technologies (LUMN – Research Report), with a price target of $1.75.
Eric Luebchow’s Hold rating for Lumen Technologies is rooted in a cautious optimism regarding the company’s future performance. The fourth quarter results of 2023 surpassed expectations, which hints at stability in the upcoming year and potential growth thereafter. Luebchow acknowledges the positive impact of the TSA transaction, which is likely to alleviate near-term debt concerns and offer a financial cushion for future investments. Despite these promising signs, he perceives the revenue turnaround to be a long-term prospect, projecting a significant shift only post-2025.
The analyst also notes early positive developments in Lumen’s Public Sector and the consistent build rate of Fiber-to-the-Home (FTTH). However, the overall enterprise market decline and the challenges faced in gaining market share in the mid-market segment lead to a more reserved outlook. Additionally, Luebchow is wary of the operational risks associated with the FTTH build and the lagging sales and marketing efforts. Thus, he recommends maintaining a neutral stance until concrete improvements are observed in the company’s larger business segments.
In another report released on February 7, TD Cowen also maintained a Hold rating on the stock with a $3.50 price target.
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Lumen Technologies (LUMN) Company Description:
Lumen Technologies is a technology and communications company focused on providing business and mass markets customers. It offers public and private cloud solutions, Colocation and Data Center Services, IT solutions, Unified Communications and Collaboration, Content Delivery, and Managed Security Services. Lumen operates through three brands, including its flagship brand Lumen targeting the enterprise and wholesale markets. Further, it provides fiber-based services to residential and small business customers via the Quantum Fiber brand. Moreover, it focuses on the mass market through its CenturyLink brand.
Read More on LUMN:
- Lumen Technologies Unveils Financials and Future Projections
- Lumen sees FY24 adjusted EBITDA $4.1B-$4.3B, FCF $100M-$300M
- Lumen reports Q4 adjusted EPS 8c, consensus (1c)
- Lumen Technologies reports fourth quarter and full year 2023 results
- Lumen Technologies options imply 25.9% move in share price post-earnings
