It should be no measure of how far Level 3
So this is what years of disappointing results and a contemptible stock options program get you, I guess. Obscurity. All of the excitement of a test pattern. Level 3 has its core followers (no pun intended), but no one else seems to care anymore.
Of course, sometimes in investing, that's not a bad thing. When no one's looking, opportunity can knock.
Level 3's loss for the quarter narrowed to $63 million, or $0.09 per share, an improvement from $462 million, or $0.95 per share, for the same quarter a year ago. These results included a one-time gain of $147 million stemming from the company's elimination of several capital lease obligations. Even after you back out the $0.22 gain, Level 3's core results were more than anticipated on Wall Street. That's good news, but nothing earth-shattering.
The company's stock rocketed downward, though, because for Level 3, the lack of great news is increasingly becoming bad news. Level 3 raised billions in debt to build out its network, and large slugs of that debt principal are getting ever closer to coming due. Level 3 has an absolute cost advantage over its competitors such as MCI
With CEO James Crowe guiding revenue targets lower and projecting continued cash losses at the company, along with no telling increase in deferred revenue, Level 3 seems to continue treading water. That's an achievement in and of itself in the telecommunications transport environment that exists today, but unfortunately Level 3 cannot afford to spin its wheels forever.
Bill Mann owns none of the companies mentioned in this article.