Please ensure Javascript is enabled for purposes of website accessibility

Why Windstream Holdings Fell Nearly 11% in January

By Chris Neiger - Feb 13, 2018 at 12:35PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company's poor performance in 2017 extended into this year after an analyst downgrade.

What happened

Shares of Windstream Holdings (WINMQ) dropped by 10.8% last month, according to data provided by S&P Global Market Intelligence, after an analyst at JP Morgan downgraded the company's shares from Neutral to Underweight.

So what

Investors were already fleeing Windstream after the company's tumultuous 2017. The regional telecom company missed nearly all of Wall Street's earnings consensus estimates last year and caught investors off guard when it eliminated its dividend in late 2017. All of that caused Windstream's stock to fall nearly 75% last year, and that carried over into January with JP Morgan's downgrade.

Arrow falling overlaid on top of stock chart.

Image source: Getty Images.

Analyst Philip Cusick said that the company will face near- and long-term problems as it tries to fight off increasing competition from cable and satellite competitors. Cusick believes the competition could end up taking up to 60% of Windstream's current customers.

Investors had clearly already been cooling to Windstream's stock, and the analyst's comments continued to erode hope that the company is on the right path.

Now what

Windstream's shares have continued to slide this month and have already fallen by about 5% as of this writing. The company's management said it was optimistic about Windstream's future on its third-quarter earnings call back in November -- but investors are having a hard time buying the growth story that Windstream's leadership is selling.

 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Windstream Holdings, Inc. Stock Quote
Windstream Holdings, Inc.
WINMQ

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
336%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.