Back to top

Can Cincinnati Bell???s (CBB) Initiatives Drive Growth?

Read MoreHide Full Article

On Oct 3, we issued an updated research report on diversified telecommunications and technology services provider Cincinnati Bell Inc. (CBB - Free Report) .

Cincinnati Bell is focused on transforming itself into a fiber-based communications, entertainment and IT solutions company with growing revenues, profitability and cash flow. With a well-designed marketing program, popular brand value and strong reputation of offering high-quality service, the company expects to boost its Entertainment and Communications revenues.

In the Entertainment and Communications business, the company’s investments in Fioptics products, which provide entertainment, high-speed Internet and traditional voice via fiber line to homes, are on the rise. Cincinnati Bell continues to deploy fiber network, which is expected to provide high-quality video and Internet service to its residential customers.

Also, Cincinnati Bell is increasingly focusing on providing services to small and mid-sized Businesses (SMBs). The company recently announced the creation of a new business division aimed at providing support services like voice, data and technology integration for SMBs. Also, CBTS, the wholly owned subsidiary of Cincinnati Bell, partnered with Cisco Systems, Inc. (CSCO - Free Report) to provide Enterprise Hosted Communications Solution (EHCS). EHCS is a cloud-based solution aimed at increasing productivity for CBTS’s business clients.

However, Cincinnati Bell continues to experience erosion in high margin local access lines. With Digital Subscriber Line (DSL) and cable modems gaining widespread acceptance, customers are deactivating the extra phone lines that were used to access the Internet via dial-up modem. In addition, the shift toward wireless services and aggressive rollout of VoIP and long distance services by Tier-1 competitors such as AT&T Inc. (T - Free Report) and Verizon Communications Inc. (VZ - Free Report) in Cincinnati and Dayton has further contributed to access line erosion. Also, the company has been witnessing a slower pace of ARPU growth lately.

Cincinnati Bell currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Confidential from Zacks

Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>

More from Zacks Analyst Blog

You May Like