) recently inked a deal worth $233 million with Social Security
Administration (SSA) to provide data network support to the latter
for the next five years.
SSA operates globally through 1,500 offices located across
different countries and has massive head count of approximately
62,000. So CenturyLink will enhance the service quality of SSA by
means of providing better network infrastructure for data, video
and voice services to the SSA.
In 2008, SSA awarded a voice service order to Qwest, which was then
acquired by CenturyLink in 2011. The acquisition will facilitate
SSA's internal communications by means of audio and video
Although CenturyLink makes huge investments (expected to be in the
range of $2.6-$2.8 billion this year), it maintains a high-quality
balance sheet, superior cash flow and offers healthy returns to its
shareholders through dividend payments. Moreover, continuous
acquisition coupled with the roll out of fiber-to-the-node (FTTN)
access to additional 1 million homes by the end of the year will
help the company to expand its IPTV markets.
However, intense competition from top telecom carriers like
Verizon Communication Inc.
) along with continuous loss of customers and lower minute's usage
will act as headwinds going forward. We thus maintain our long-term
Neutral recommendation on CenturyLink Inc.
Currently, CenturyLink has a Zacks #3 Rank, implying a short-term
Hold rating on the stock.
Based in Monroe, Louisiana, CenturyLink Inc. is the third largest
telecommunications company in the U.S. It provides a range of
communications services, including local and long distance voice,
wholesale network access, high-speed Internet access, managed
hosting and collocation services, other data services and video
(We are reissuing this article to correct several mistakes.
The original article, issued June 15, 2012, should no longer be
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