The Herald Business Journal
Frontier Communications saw its stock price drop to a 34-year low Wednesday after a disappointing earnings report this week, according to Market Watch, a financial information website that provides business news and analysis.
The stock price for the company fell to $1.61, the lowest price since August 1983. In its earnings report Tuesday, Frontier said it would pay a dividend of 4 cents a share, but that was 62 percent below the prior quarter dividend of 10.5 cents a share, according to Market Watch.
The company also is considering a 1-for-15 reverse stock split, according to Market Watch. The split is subject to shareholder approval May 10. A reverse stock split is a corporate action to reduce the number of outstanding shares.
Frontier Communications is based in Norwalk, Connecticut. The company’s regional headquarters for Western Washington is in Everett.
The company provides phone, cable TV and internet service.
Last fall, the company announced that it was laying off 1,000 employees across the U.S. Before the job cuts, the company had about 18,600 employees.
Frontier has seen its stock steadily decline over the past year. The company’s stock was trading at $5.18 a share on May 5, 2016, according to Yahoo Finance. It was trading as high as $3.76 a share in early January. The $1.61 a share price Wednesday was at the close of market.
The Motley Fool, another business news and analysis website, said the slashing of the stock dividend will free up cash to pay the company’s debt load.
“While Frontier’s decision to cut the dividend is likely to drive several income investors away from its stock, there’s little doubt that it was the right move for the long-term health of the business,” according to The Motley Fool.
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