Windstream Corporation (WIN), a fixed-line voice and DSL Internet service provider, announced that it will offer larger bandwidth Ethernet to 11 new markets with a speed of 1 gigabyte per second.
These new markets include Akron, Columbus, Indianapolis, Dayton, Wichita, Tulsa, Oklahoma City, Northwest Arkansas, Augusta, Baton Rouge and Mobile. The company promises expanded bandwidth at a cheaper cost per megabyte and increased efficiency for businesses.
Windstream continues to widen its fiber-to-the-cell and data center technology footprint. This will widen Windstream’s broadband availability to roughly 93% customers and upgrade network and broadband speeds in under-served areas, which will result in attractive growth opportunities given improved demand in these areas.
Furthermore, Windstream emphasizes on offering bundled products and services to gain competitive advantage over Tier 1 peers like AT&T (T) and Verizon Communications (VZ). Bundled local phone, high speed Internet, and long distance and video services will improve the customer retention ratio by lowering churn.
In the business channel, Windstream will boost its efforts to expand service offerings, such as Internet Protocol services, managed services, data center co-location and fiber transport, as well as to grow distribution channels. In residential business, the company will maintain its “Price for Life” pricing strategy but increase pricing for certain plans such as Greenstreak and secondary lines. Furthermore, the company is expanding its coverage and speeds of broadband network that will fuel incremental revenue opportunities.
Currently, we maintain our long-term Neutral recommendation on Windstream. However, the stock currently has a short-term (1–3 months) Zacks #4 (Sell) Rank.
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