Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Atlantic Tele-Network (Nasdaq: ATNI) , a wireless and wire-line provider in North America, Bermuda, and the Caribbean, soared as much as 25% following better-than-expected first-quarter earnings results.
So what: Despite a 3% decline in total revenue due to higher U.S. wireless customer attrition, Atlantic Tele-Network was able to muster strong international growth and U.S. wholesale growth to push its operating income up 75% year-over-year and produce $0.60 in EPS. This handily beat the $0.46 consensus EPS estimate. On top of this, brokerage firm Stephens upgraded the company to overweight from equal weight and raised its price target to $46 from $43 based on the improving wireless metrics noted in its quarterly report.
Now what: This was a very mixed report and I can't say I'm all that impressed with Atlantic Tele-Network. Perhaps the most exciting aspect was not the figures at all, but the fact that it soon will be partnering with Wal-Mart (NYSE: WMT) as one of its wholesalers. Still, I find the attrition rate among its U.S. wireless business to be worrisome, as well as its lack of revenue growth. There's only so much cost-cutting a company can do before you can no longer mask stagnant growth. At nearly 17 times forward earnings, I'd pass here.
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