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What happened

Shares of Windstream Holdings (NASDAQ:WINMQ) rose 18.1% in September 2016, according to data from S&P Global Market Intelligence. These gains were all about Windstream expanding its services into new markets.

So what

For the most part, Windstream shares rose and fell along with its peers in the regional network services sector. But a few key dates set Windstream apart, with single-day gains between 1.5% and 3.2%. These surges all followed Windstream's announcement of high-speed network services in new markets.

The company is expanding its metro fiber networks in Atlanta and Minneapolis. These expansions will allow Windstream to offer high-speed broadband services far beyond the city cores, blanketing nearby business districts and suburbs in fiber links. The fiber then connects directly to Windstream's growing coast-to-coast network of long-distance links.

Elsewhere, the company opened up fixed wireless-network services in Salt Lake City. Armed with a rooftop microwave receiver, businesses across that region can now set up Windstream's voice and data services with fiber-like gigabit speeds and high availability. Salt Lake City is Windstream's 22nd target market for this solution, and is one of the larger cities in the portfolio.

WIN Chart

WIN data by YCharts.

Now what

These important service expansions are offered in partnership with former Windstream infrastructure division Communications Sales & Leasing (NASDAQ: CSAL). CS&L shoulders the burden of building the network infrastructure, and then Windstream has a master lease in place to run its consumer and business services over that hardware.

I'm interested enough in this unusual arrangement to have started a real-money position in CS&L for myself (but not in Windstream). CS&L is free to seek other clients besides Windstream, providing another path toward future growth. And it's hard to complain about the 8% dividend yield I'm enjoying on those CS&L shares, backed by torrential cash flows.

That being said, Windstream's own cash flows are also reliably positive. They power another generous dividend policy, currently standing at an annual yield of 7%. After a slow start, both stocks have bounced back recently. Windstream shares have gained 26% over the last year, while CS&L shows a 51% increase.

Windstream reports third-quarter results in early November, followed by CS&L a week later.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.