Frontier Communications Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Frontier Communications (NASDAQ:FTR) will unveil its latest earnings on Tuesday, July 31, 2012. Frontier Communications provides telecommunications services to rural areas and small and medium-sized towns and cities.

Frontier Communications Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 5 cents per share, a decline of 16.7% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 6 cents. Between one and three months ago, the average estimate moved down. It has risen from 4 cents during the last month. For the year, analysts are projecting net income of 20 cents per share, a decline of 16.7% from last year.

Past Earnings Performance: Last quarter, the company fell short of estimates by 2 cents, coming in at profit of 5 cents per share against a mean estimate of net income of 6 cents. The company topped expectations in the fourth quarter of the last fiscal year.

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A Look Back: In the first quarter, profit fell 51.1% to $26.8 million (3 cents a share) from $54.7 million (5 cents a share) the year earlier, missing analyst expectations. Revenue fell 5.8% to $1.27 billion from $1.35 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.77 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company regressed in this liquidity measure from 1.07 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 33.2% to $1.58 billion while assets decreased 4.2% to $1.22 billion.

Wall St. Revenue Expectations: On average, analysts predict $1.24 billion in revenue this quarter, a decline of 6.1% from the year-ago quarter. Analysts are forecasting total revenue of $4.94 billion for the year, a decline of 5.7% from last year’s revenue of $5.24 billion.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of three-straight quarters of revenue declines. Revenue fell 8% in the third quarter of the last fiscal year and 5.6% in fourth quarter of the last fiscal year before falling again in the first quarter.

Heading into this earnings announcement, net income has dropped 24.3% on average for the last four quarters.

Analyst Ratings: There are mostly holds on the stock with nine of 14 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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