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.
Level 3 Communications Down to Sell, Competition a Woe
Read MoreHide Full Article
On Jun 28, Zacks Investment Research downgraded leading communications company, Level 3 Communications, Inc. by a notch to a Zacks Rank #4 (Sell).
The company's top line faces the risk of the impact of adverse foreign currency movements. Moreover, intense competition in the enterprise communications market and the company’s high customer concentration are material headwinds.
Rising Competition
As stated earlier, enterprise communications is a highly competitive market. In North America, Level 3 Communications shares space with telecom behemoths like Verizon Communications Inc. (VZ - Free Report) and A&T Inc. (T - Free Report) . Comcast Corp. (CMCSA - Free Report) is the latest entrant in the market. In Europe and Latin America, the company competes with companies like Telefonica, Orange, BT Group and Telmex among others. Most of these companies boast a better resources portfolio compared to Level 3 Communications, which enables them to bring technically superior products to market.
High Customer Concentration
Customer concentration is another major concern for Level 3 Communications. The company's top 10 customers account for the majority of its top line. Thus, the loss of any of these customers or consolidation among them will have a significant impact on its revenues. Also, fluctuations in the global macro economy could have an adverse effect on the company’s business, results of operations and financial condition.
On the Bright Side
Level 3 Communications has a strong presence in several aspects of the enterprise networking market, including data networks, content distribution, managed services, securities, voice cloud and cloud connection. The company stands to benefit from the ongoing trend of large enterprise customers shifting to IP and fiber-based network architecture. Also, as per research carried out by Vertical Systems Group, Level 3 Communications has been consistently gaining share in the global Ethernet market.
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 >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Level 3 Communications Down to Sell, Competition a Woe
On Jun 28, Zacks Investment Research downgraded leading communications company, Level 3 Communications, Inc. by a notch to a Zacks Rank #4 (Sell).
The company's top line faces the risk of the impact of adverse foreign currency movements. Moreover, intense competition in the enterprise communications market and the company’s high customer concentration are material headwinds.
Rising Competition
As stated earlier, enterprise communications is a highly competitive market. In North America, Level 3 Communications shares space with telecom behemoths like Verizon Communications Inc. (VZ - Free Report) and A&T Inc. (T - Free Report) . Comcast Corp. (CMCSA - Free Report) is the latest entrant in the market. In Europe and Latin America, the company competes with companies like Telefonica, Orange, BT Group and Telmex among others. Most of these companies boast a better resources portfolio compared to Level 3 Communications, which enables them to bring technically superior products to market.
High Customer Concentration
Customer concentration is another major concern for Level 3 Communications. The company's top 10 customers account for the majority of its top line. Thus, the loss of any of these customers or consolidation among them will have a significant impact on its revenues. Also, fluctuations in the global macro economy could have an adverse effect on the company’s business, results of operations and financial condition.
On the Bright Side
Level 3 Communications has a strong presence in several aspects of the enterprise networking market, including data networks, content distribution, managed services, securities, voice cloud and cloud connection. The company stands to benefit from the ongoing trend of large enterprise customers shifting to IP and fiber-based network architecture. Also, as per research carried out by Vertical Systems Group, Level 3 Communications has been consistently gaining share in the global Ethernet market.
LEVEL 3 COMM Price
LEVEL 3 COMM Price | LEVEL 3 COMM Quote
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 >>