On Oct 7, 2014, Zacks Investment Research upgraded Telephone & Data Systems Inc. (TDS) by a notch to a Zacks Rank #2 (Buy).
Why the Upgrade?
On Sep 25, Telephone & Data Systems’ wholly owned subsidiary TDS Telecom launched its new personal cloud service – younited by F-Secure. The new product is designed to work on mobile devices and is accessible anywhere.
While the new product will result in enhanced market share for the company, we believe it will help the company extend its cloud service to the retail segment, beyond the conventional enterprise market.
According to the press release, an unlimited number of devices can be backed up using younited with ready access to the younited website or the younited app for mobile devices, which is available for both the iOS and Android operating systems. Apart from simple backup service, younited will also allow customers to organize files and create collections for sharing, using secure email and text links or by linking to a Chromecast TV dongle.
Also, last month, the carrier strengthened its cable growth strategy by completing the acquisition of all assets of BendBroadband for $261 million in cash. Management is optimistic about capturing additional data market share through the acquisition.
The company’s wireless business is expected to show strength buoyed by increased handset offerings, shared data plans, equipment financing and expansion of LTE technology. Continued focus on broadband growth and related acquisitions are expected to increase its market share. Moreover, further expansion into the rapidly developing managed hosting and cloud service offerings will likely aid profitability going forward.
Stocks that Warrant a Look
Some other well-placed stocks worth considering in the sector are Chunghwa Telecom Co., Ltd. (CHT), Verizon Communications Inc. (VZ) and Lumos Networks Corp. (LMOS). All these stocks hold the same Zacks Rank as Telephone & Data Systems.
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
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment