When we discussed the death of Windstream Holdings, Inc. (WIN), we laid out our major concerns which included declines in nearly all business segments, mounting earnings losses, and major debt problems. We wanted you to avoid the name. Today we were asked about our current view on the stock given that it has seen wild trading since Windstream reported earnings. Thus, in this column, we discuss why we believe that the company remains under pressure which keeps the stock from rallying meaningfully. We will discuss performance and our outlook for the company in 2018, which we see as a new beginning for the company and the stock.

New all-time lows

The stock continues to make new all-time lows:

Source: Yahoo Finance

Make no mistake, at this level, we still believe there is value, but it is speculative. Understand that an investment in this name is a bet on the debt. The reasons that investors owned the name have changed. This high-risk telecom was attractive for the bountiful dividend, but the dividend elimination will save the company significant cash, and it will use these savings to buy back stock, and service debt. WIN has about $6 billion of debt , and there are ongoing issues with Uniti. We want to focus on performance of the brand. There is a long road ahead for Windstream, but there are some reasons to be positive.



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