Many stocks have been testing new highs in 2020, and one of the most notable is Telecom Argentina S.A. (TEO). Currently, TEO is trading at $11.44 and the avg recommendation for the stock is Hold. while the current analyst price target stands at $13.94.
To add more color to this target, the company’s high over the last year is $16.90 and the low is $6.57. Over the last 52 weeks, TEO is down -32.29% while the S&P 500 is up 1.21%. The catalyst for this interesting swing was the company’s recent earnings report.
A Notable Earnings Report
In the last quarter, TEO reported a profit of $93.99 million. Telecom Argentina S.A. also saw revenues increase to $1.02 billion. In addition, TEO has free cash flow of $84.43 million as of 03-2020 The company’s EBITDA came in at $357.9 million which compares well with its peers.
About Telecom Argentina S.A.
If readers are unfamiliar, Telecom Argentina S.A., together with its subsidiaries, provides telecommunications services in Argentina and internationally. The company offers telephone services, including local, domestic, and international long-distance telephone services, as well as public telephone services; interconnection services, such as access, termination, and long-distance transport of calls; information and communication technology services comprising datacenter services, and telecommunications consulting and value-added solutions; and call waiting, call forwarding, conference calls, caller ID, voice mail, itemized billing, and maintenance services, as well as sells equipment. It also provides mobile telecommunications services that include voice communications, high-speed mobile Internet content and applications download, mobile multimedia, short message, online streaming, corporate email, social network access, and other services; and sells mobile communication devices that include handsets, Modems mifi and wingles, smart watches under the Personal brand. In addition, the company offers data transmission and Internet services comprising broadband, Internet dedicated lines, private networks, national and international video streaming, transportation of radio and TV signals, and video conferencing services; and programming and other cable television services. The company was formerly known as Cablevision S.A. and changed its name to Telecom Argentina S.A. in January 2018. Telecom Argentina S.A. was founded in 1979 and is based in Buenos Aires, Argentina. Cablevision S.A. operates independently of Grupo Clarin S.A. as of August 31, 2017.
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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. TEO has a short ratio of 5.60 and outstanding shares of 432.03M.
TEO has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 0.36 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at -0.13. Telecom Argentina S.A. TEO also noted assets of $10.2 billion at the end of the last quarter. Investors should also keep an eye on sector updates as TEO has historically followed its peers on positive news.
All told, Telecom Argentina S.A. TEO has strung together solid data and demonstrated underlying fundamentals. At its current valuation, TEO represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.
Telecom Argentina S.A. TEO is now commanding a market cap of 2.31B and a float of 89.83M. TEO is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of TEO stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in TEO, either long or short, and we have not been compensated for this article.