We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Telephone & Data Systems (TDS) Beats on Earnings in Q2
Read MoreHide Full Article
Telephone & Data Systems Inc. (TDS - Free Report) reported strong financial results in the second quarter of 2016, wherein both the top and bottom lines surpassed the respective Zacks Consensus Estimate.
GAAP net income in the second quarter of 2016 was $28 million or 25 cents per share compared with $23 million or 21 cents per share in the year-ago quarter. Quarterly adjusted earnings per share of 20 cents were ahead of the Zacks Consensus Estimate of 16 cents.
Revenues were up 1% year over year to $1,283 million in the reported quarter, surpassing the Zacks Consensus Estimate of $1,241 million. Operating expenses were $1,242 million, flat year over year. The company reported quarterly operating income of $42 million compared with $32 million in the year-ago quarter.
U.S. Cellular Division
The company’s wireless subsidiary United States Cellular Corp. (USM - Free Report) reported second-quarter 2016 earnings per share of 32 cents, outpacing the Zacks Consensus Estimate of 17 cents.
Second-quarter revenues of $980 million were up 0.4% year over year, surpassing the Zacks Consensus Estimate of $969 million. Quarterly Service revenues decreased 8% to $762 million. Revenues from Equipment sales were up a substantial 44% to $218 million.
Smartphone sales retained its strength and represented 77% penetration among postpaid customers, up from 69% recorded in the year-ago quarter. Total cell sites in service were 6,324 compared with 6,223 in the year-ago quarter. Smartphones sold, as a percentage of total handsets sold, constituted 91% against 87% in the prior-year quarter.
United States Cellular exited the second quarter with a subscriber base of 4,973,000 compared with 4,779,000 at the end of the year-ago quarter. Postpaid subscriber base was 4,490,000 against 4,324,000 at the end of the prior-year quarter. Meanwhile, prepaid subscriber base totaled 413,000 compared with 368,000 at the end of the year-ago quarter. In the reported quarter, United States Cellular added a net of 36,000 postpaid subscribers compared with 17,000 in the year-ago quarter. The company also gained 14,000 prepaid customers in the same quarter compared with 8,000 in the prior-year quarter.
TDS Division
In the reported quarter, total revenue came in at $300 million, up 2% year over year. Within the segment, revenues from the wireline segment came in at $175 million, flat year over year. Cable revenues were $45 million, flat year over year while HMS revenues increased 6% to $80 million.
Subscriber Statistics
As of Jun 30, 2016, Telephone & Data Systems had 590,200 residential wireline connections, up 0.4% year over year. Of the total, voice connections were 316,800, down 3.7%. Broadband Connections were 232,200, up 0.4%. IPTV connections were 41,200, up a substantial 47.7%. Quarterly total residential revenue per connection was $43.67 compared with $42.10 in the year-ago quarter.
The company exited the reported quarter with 334,900 commercial wireline connections, down 4.5% year over year. Of the total, voice connections were 164,000, down 9.8%. Broadband Connections were 21,900, down 7.6%. ManagedIP connections were 149,000, up 2.7%.
Total cable connections were 287,600, up 5.4% year over year. Of the total, voice connections were 58,900, up 14.4%. Broadband Connections were 125,700, up 11.9%. Video connections were 102,900, down 5.7%.
In second-quarter 2016, Telephone & Data Systems generated $154 million of cash from operations compared with $183 million in the prior-year quarter. Quarterly adjusted free cash flow was $34 million against a negative $3 million in the year-earlier quarter.
Liquidity
Telephone & Data Systems exited the second quarter with cash and marketable securities of $899 million compared with $985 million at the end of 2015. At second-quarter end, total debt was $2,450 million versus $2,454 million at 2015 end. At second quarter-end, the debt-to-capitalization ratio stood at 0.34, flat with the end-2015 figure.
Guidance
For full-year 2016, the TDS division projects total operating revenue in the range of $1,130–$1,180 million. Both operating cash flow and adjusted EBITDA are estimated in the band of $270–$310 million while capital expenditure is projected at around $180 million.
Zacks Rank & Stocks to Consider
Telephone & Data Systems currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same sector are Cincinnati Bell Inc. and Telecom Italia S.p.A. . Both the stocks hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Telephone & Data Systems (TDS) Beats on Earnings in Q2
Telephone & Data Systems Inc. (TDS - Free Report) reported strong financial results in the second quarter of 2016, wherein both the top and bottom lines surpassed the respective Zacks Consensus Estimate.
GAAP net income in the second quarter of 2016 was $28 million or 25 cents per share compared with $23 million or 21 cents per share in the year-ago quarter. Quarterly adjusted earnings per share of 20 cents were ahead of the Zacks Consensus Estimate of 16 cents.
Revenues were up 1% year over year to $1,283 million in the reported quarter, surpassing the Zacks Consensus Estimate of $1,241 million. Operating expenses were $1,242 million, flat year over year. The company reported quarterly operating income of $42 million compared with $32 million in the year-ago quarter.
U.S. Cellular Division
The company’s wireless subsidiary United States Cellular Corp. (USM - Free Report) reported second-quarter 2016 earnings per share of 32 cents, outpacing the Zacks Consensus Estimate of 17 cents.
Second-quarter revenues of $980 million were up 0.4% year over year, surpassing the Zacks Consensus Estimate of $969 million. Quarterly Service revenues decreased 8% to $762 million. Revenues from Equipment sales were up a substantial 44% to $218 million.
Smartphone sales retained its strength and represented 77% penetration among postpaid customers, up from 69% recorded in the year-ago quarter. Total cell sites in service were 6,324 compared with 6,223 in the year-ago quarter. Smartphones sold, as a percentage of total handsets sold, constituted 91% against 87% in the prior-year quarter.
United States Cellular exited the second quarter with a subscriber base of 4,973,000 compared with 4,779,000 at the end of the year-ago quarter. Postpaid subscriber base was 4,490,000 against 4,324,000 at the end of the prior-year quarter. Meanwhile, prepaid subscriber base totaled 413,000 compared with 368,000 at the end of the year-ago quarter. In the reported quarter, United States Cellular added a net of 36,000 postpaid subscribers compared with 17,000 in the year-ago quarter. The company also gained 14,000 prepaid customers in the same quarter compared with 8,000 in the prior-year quarter.
TDS Division
In the reported quarter, total revenue came in at $300 million, up 2% year over year. Within the segment, revenues from the wireline segment came in at $175 million, flat year over year. Cable revenues were $45 million, flat year over year while HMS revenues increased 6% to $80 million.
Subscriber Statistics
As of Jun 30, 2016, Telephone & Data Systems had 590,200 residential wireline connections, up 0.4% year over year. Of the total, voice connections were 316,800, down 3.7%. Broadband Connections were 232,200, up 0.4%. IPTV connections were 41,200, up a substantial 47.7%. Quarterly total residential revenue per connection was $43.67 compared with $42.10 in the year-ago quarter.
The company exited the reported quarter with 334,900 commercial wireline connections, down 4.5% year over year. Of the total, voice connections were 164,000, down 9.8%. Broadband Connections were 21,900, down 7.6%. ManagedIP connections were 149,000, up 2.7%.
Total cable connections were 287,600, up 5.4% year over year. Of the total, voice connections were 58,900, up 14.4%. Broadband Connections were 125,700, up 11.9%. Video connections were 102,900, down 5.7%.
TELEPHONE &DATA Price, Consensus and EPS Surprise
TELEPHONE &DATA Price, Consensus and EPS Surprise | TELEPHONE &DATA Quote
Cash Flow
In second-quarter 2016, Telephone & Data Systems generated $154 million of cash from operations compared with $183 million in the prior-year quarter. Quarterly adjusted free cash flow was $34 million against a negative $3 million in the year-earlier quarter.
Liquidity
Telephone & Data Systems exited the second quarter with cash and marketable securities of $899 million compared with $985 million at the end of 2015. At second-quarter end, total debt was $2,450 million versus $2,454 million at 2015 end. At second quarter-end, the debt-to-capitalization ratio stood at 0.34, flat with the end-2015 figure.
Guidance
For full-year 2016, the TDS division projects total operating revenue in the range of $1,130–$1,180 million. Both operating cash flow and adjusted EBITDA are estimated in the band of $270–$310 million while capital expenditure is projected at around $180 million.
Zacks Rank & Stocks to Consider
Telephone & Data Systems currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same sector are Cincinnati Bell Inc. and Telecom Italia S.p.A. . Both the stocks hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>