Have Dividend Cuts Helped Frontier?

It is often the case that shareholders have to give up short-term gains for long-term benefits. This is exactly what happened with Frontier Communications (FTR) shareholders when the company announced its first dividend cut. It was not easy for Frontier to triple the size of the company and maintain the same levels of dividends. Growth through acquisitions usually comes at a cost. In Frontier's case, the income hunting investors paid the price. Aggressive acquisitions saddled the company with massive debt levels and weak cash flows. In addition, the integration and restructuring costs impacted the earnings of the company. However, the dividend cut was a necessary step, which the company had to take for the long term stability. In my previous articles, I have done a thorough free cash flow and valuation analysis for Frontier. However, the debt levels of the company have always intrigued me, and I... Read more