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What: Did you think the old Ma Bell had been virtually reconstituted with AT&T's
So what: Cincinnati Bell
Now what: That sounds pretty good, but remember to read the fine print on your wireless agreement. While C-Bell claims to have earned adjusted earnings before interest, taxes, depreciation, and amortization of $530 million, the devil is in the BITDA details. Ex-out the ITDA, and C-Bell actually netted only $0.08 per share in GAAP profit, down 20% from last year -- and a mere $5 million in free cash flow.
What that means is that this $640 million telecom, pegged for 2.5% long-term growth, is selling for about 27 times GAAP earnings today. It's a bit cheaper when valued on free cash flow (5.3). But considering that, unlike its larger telecom siblings, C-Bell doesn't pay any dividend at all, it's still no bargain for the growth rate.
Want to learn more about Cincinnati Bell? Add it to your watchlist.
Fool contributor Rich Smith owns no shares of, nor is he short, any company named above.
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