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Lumen (LUMN) Reportedly Needs Time to Close Restructuring Deal
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Lumen Technologies (LUMN - Free Report) is requesting more time from creditors to conclude its debt restructuring deal, per a report from Bloomberg. There was no official word on the matter from the company.
Citing sources familiar with the matter, Bloomberg noted that Lumen wants the deadline to be extended by one month and close on Jan 31, 2024. Creditors have agreed to the extension, but the reprieve has not been finalized yet.
Per sources, Lumen has been discussing the extension of the deadline on its credit line with banks in the past few weeks. LUMN will require all banks to sign on to the restructuring deal for it to be finalized. The discussions also include the topic of bank lenders receiving better priority in the line for repayment.
In November 2023, the firm announced that it inked an agreement with a group of creditors holding more than $7 billion of the outstanding debt (of the company and its subsidiaries) to extend the maturities of the debt instruments. The deal will also provide Lumen with another $1.2 billion of fresh financing.
As of Sep 30, 2023, the company had $311 million in cash and cash equivalents with $19,740 million of long-term debt compared with the respective figures of $411 million and $19,899 million as of Jun 30, 2023.
Lumen’s performance is affected by weakness in Business, Enterprise Channels and Mass markets business segments. It is currently in the middle of a time-consuming business transformation initiative. We expect revenues for 2023 to decline 17.3% year over year.
LUMN has undertaken a business transformation initiative whereby it has shed many non-core businesses to focus only on its robust growth opportunities. In August 2022, it sold its Latin American business to Stonepeak for $2.7 billion. It also completed the $7.5 billion divestiture of its 20-state ILEC business in October 2022. The company offloaded its Europe, Middle East and Asia (EMEA) business to Colt Technology Services for $1.8 billion in November 2023. It also sold a few of its content delivery network (CDN) service contracts to Akamai Technologies.
Nonetheless, continued momentum in cloud, colocation and intellectual property augurs well, along with heavy investment in the Quantum fiber business. The firm had 896,000 quantum fiber subscribers at the end of the third quarter.
Lumen currently carries a Zacks Rank #4 (Sell). Shares of the company have lost 66.6% against the sub-industry’s growth of 45.5% in the past year.
The Zacks Consensus Estimate for Blackbaud’s 2023 EPS improved 1.8% in the past 60 days to $3.86. BLKB’s long-term earnings growth rate is 23.4%. Blackbaud’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 10.6%. Shares of BLKB surged 49.8% in the past year.
The Zacks Consensus for NETGEAR’s 2023 EPS has remained unchanged in the past 30 days at a loss of 9 cents. NTGR’s earnings outpaced the Zacks Consensus Estimate in three of the last four quarters while missing in the remaining quarter. The average surprise was 127.5%. Shares of NTGR were down 19.4% in the past year.
The Zacks Consensus Estimate for Watts Water Technologies 2023 EPS has improved by 3.9% in the past 60 days to $8.08.
WTS’ earnings outpaced the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS jumped 40.9% in the past year.
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Lumen (LUMN) Reportedly Needs Time to Close Restructuring Deal
Lumen Technologies (LUMN - Free Report) is requesting more time from creditors to conclude its debt restructuring deal, per a report from Bloomberg. There was no official word on the matter from the company.
Citing sources familiar with the matter, Bloomberg noted that Lumen wants the deadline to be extended by one month and close on Jan 31, 2024. Creditors have agreed to the extension, but the reprieve has not been finalized yet.
Per sources, Lumen has been discussing the extension of the deadline on its credit line with banks in the past few weeks. LUMN will require all banks to sign on to the restructuring deal for it to be finalized. The discussions also include the topic of bank lenders receiving better priority in the line for repayment.
In November 2023, the firm announced that it inked an agreement with a group of creditors holding more than $7 billion of the outstanding debt (of the company and its subsidiaries) to extend the maturities of the debt instruments. The deal will also provide Lumen with another $1.2 billion of fresh financing.
Lumen Technologies, Inc. Price and Consensus
Lumen Technologies, Inc. price-consensus-chart | Lumen Technologies, Inc. Quote
As of Sep 30, 2023, the company had $311 million in cash and cash equivalents with $19,740 million of long-term debt compared with the respective figures of $411 million and $19,899 million as of Jun 30, 2023.
Lumen’s performance is affected by weakness in Business, Enterprise Channels and Mass markets business segments. It is currently in the middle of a time-consuming business transformation initiative. We expect revenues for 2023 to decline 17.3% year over year.
LUMN has undertaken a business transformation initiative whereby it has shed many non-core businesses to focus only on its robust growth opportunities. In August 2022, it sold its Latin American business to Stonepeak for $2.7 billion. It also completed the $7.5 billion divestiture of its 20-state ILEC business in October 2022. The company offloaded its Europe, Middle East and Asia (EMEA) business to Colt Technology Services for $1.8 billion in November 2023. It also sold a few of its content delivery network (CDN) service contracts to Akamai Technologies.
Nonetheless, continued momentum in cloud, colocation and intellectual property augurs well, along with heavy investment in the Quantum fiber business. The firm had 896,000 quantum fiber subscribers at the end of the third quarter.
Lumen currently carries a Zacks Rank #4 (Sell). Shares of the company have lost 66.6% against the sub-industry’s growth of 45.5% in the past year.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks worth consideration in the broader technology space are Blackbaud (BLKB - Free Report) , NETGEAR (NTGR - Free Report) and Watts Water Technologies (WTS - Free Report) . While Watts Water Technologies sports a Zacks Rank #1 (Strong Buy), Blackbaud and NETGEAR, each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Blackbaud’s 2023 EPS improved 1.8% in the past 60 days to $3.86. BLKB’s long-term earnings growth rate is 23.4%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 10.6%. Shares of BLKB surged 49.8% in the past year.
The Zacks Consensus for NETGEAR’s 2023 EPS has remained unchanged in the past 30 days at a loss of 9 cents. NTGR’s earnings outpaced the Zacks Consensus Estimate in three of the last four quarters while missing in the remaining quarter. The average surprise was 127.5%. Shares of NTGR were down 19.4% in the past year.
The Zacks Consensus Estimate for Watts Water Technologies 2023 EPS has improved by 3.9% in the past 60 days to $8.08.
WTS’ earnings outpaced the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS jumped 40.9% in the past year.