ATN Worldwide (NASDAQ:) owns and operates communications infrastructure in distant and underserved areas within the western U.S., Alaska, and internationally. The agency operates by quite a few subsidiary firms, together with Alaska Communications, Selection Wi-fi, Sacred Wind, and Viya.
Buyers know ATN for its historical past of spectacular dividend yields and as a worth play. The agency gives a dividend yield of 5.66% as of February 13, 2025, a powerful prospect, alongside annualized three-year dividend development of greater than 12%. Whereas this may occasionally entice some buyers, it is vital to maintain a watch out for potential dangers this area of interest telecom firm poses for buyers as properly.
ATN’s Dividend and Worth Traits
ATN has elevated its quarterly dividend twice within the final three years; the agency paid 17 cents per share for about 5 years beginning in 2017, then bumped up the cost to 21 cents per share in 2022 and 24 cents per share in 2023. Its most up-to-date dividend cost was made in January 2025.
The corporate’s stable dividend historical past is noteworthy. Nevertheless, buyers would possibly take warning on condition that ATN at present has a unfavorable dividend payout ratio, that means that it’s persevering with to pay dividends regardless of having taken losses in some latest quarters. That is usually thought-about to be an unsustainable mannequin, though ATN’s lengthy historical past of dividend funds has to this point been unbroken.
ATN can also be more and more flashing worth metrics. Its price-to-sales ratio, for instance, is a aggressive 0.33, whereas its price-to-cash movement ratio is 1.61. Like ATN’s dividend profile, although, its standing as a worth decide is difficult by the truth that shares of ATNI have fallen by greater than 51% within the 12 months resulting in February 14, 2025. The corporate skilled a 52-week low earlier this 12 months. Nevertheless, it has extra not too long ago been trending upward; the year-to-date efficiency of ATNI shares as of the date above is 7.0%. By comparability, the S&P 500 has climbed by 4.3% over the identical interval.
A Nearer Have a look at Efficiency
As of February 14, 2025, the newest quarter that ATN has reported is Q3 of 2024. For that interval, the corporate famous a internet loss attributable to shareholders of almost $33 million, wider than losses of $3.6 million within the prior-year interval. Nevertheless, the newest quarter included a one-time $35.3 million non-cash goodwill impairment cost on a few of ATN’s US Telecom phase property. This phase additionally confronted the conclusion of two authorities subsidy applications and an anticipated discount in building revenues, compounding the underwhelming efficiency.
Regardless of these headwinds, ATN’s basic buyer demand stays robust. The corporate’s “Glass & Metal” technique favors quicker and extra dependable fiber optic infrastructure over wi-fi, and its “First-to-Fiber” purpose drives it to aggressively pursue initiatives in underserved areas with out prior fiber infrastructure. The mix of those two methods appears to have paid off—ATN reported a 6% year-over-year enhance in whole high-speed broadband subscribers final quarter, in addition to a powerful 20% enlargement of broadband houses handed by high-speed knowledge companies. On the identical time, the corporate has been in a position to enhance its operational effectivity by decreasing capital expenditures to beneath $86 million for the primary 9 months of 2024, down from almost $130 million for the primary three quarters of 2023.
Potential for Development, However Dangers Stay
ATNI shares at present have a ranking of Sturdy Purchase based mostly on two analyst suggestions, in addition to a consensus value goal of $31 per share, which is greater than 75% above present value ranges. Nevertheless, the newest of the 2 analyst scores—a reiterated Purchase ranking by BWS Monetary—is from again in November 2024, when shares have been buying and selling a number of {dollars} above their degree on February 14, 2025.
ATN could also be a case of an organization that gives compelling dividend and worth prospects on paper—a robust dividend yield and aggressive P/S ratio, amongst different metrics—in addition to some potential for development based mostly on a sexy product providing. Nevertheless, the challenges to its basic operations stay. With a brand new set of earnings outcomes anticipated to put up on February 19, analysts are predicting one other quarter of internet losses alongside income of greater than $179 million. If ATN outperforms—and notably if it may return to profitability—it could entice extra investor curiosity on this telecom inventory.
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