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Shenandoah Telecommunications Co (SHEN)
NASDAQ:SHEN
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Shenandoah Telecommunications Co
(NASDAQ:SHEN)41Neutral
Positive Factors
Revenue Growth
Glo Fiber subscribers have routinely opted for faster speed tiers resulting in average revenue per user increase.
Subscriber Growth
SHEN added approximately 5,900 Glo Fiber subscribers in the fourth quarter to surpass 65,000 total subscribers.
Negative Factors
Financial Performance
SHEN changed the recognition of $2.6 million in commercial revenue resulting in the Company missing the revenue estimate.
Shenandoah Telecommunications Co (SHEN) vs. S&P 500 (SPY)
Market Cap
$610.15M
Dividend Yield0.9%
Average Volume (3M)226.21K
Price to Earnings (P/E)―
Beta (1Y)0.38
Revenue Growth14.16%
EPS Growth-443.30%
CountryUS
Employees845
SectorCommunication Services
Sector Strength85
IndustryTelecommunications
Share Statistics
EPS (TTM)-0.55
Shares Outstanding54,672,523
10 Day Avg. Volume285,670
30 Day Avg. Volume226,210
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.86
Price to Cash Flow (P/CF)7.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$26.00Price Target Upside128.67% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Shenandoah Telecommunications Co Business Overview & Revenue Model
Company DescriptionShenandoah Telecommunications Co (SHEN) is a telecommunications company that provides a range of services primarily in the United States. It operates in sectors such as wireless services, broadband, and cable television. The company serves both residential and business customers, offering high-speed internet, voice, video, and fiber services. Shenandoah Telecommunications is known for its regional focus, particularly in rural and underserved areas, aiming to enhance connectivity and communication solutions in these regions.
How the Company Makes MoneyShenandoah Telecommunications Co generates revenue through multiple streams. A significant portion comes from providing wireless services, including voice, text, and data plans to individual and business customers. Additionally, the company earns from its broadband services, offering high-speed internet connectivity to residential and commercial clients. Cable television subscriptions also contribute to the company's income, as it delivers a variety of TV packages and on-demand services. Moreover, Shenandoah Telecommunications benefits from partnerships and agreements with other telecommunications providers, which can include roaming agreements, infrastructure sharing, and network expansion collaborations, further bolstering its revenue streams.
Shenandoah Telecommunications Co Financial Statement Overview
Summary
Shenandoah Telecommunications demonstrates financial instability across its income statement, balance sheet, and cash flow. Declining revenues, negative profitability margins, and deteriorating cash flows highlight operational challenges. The balance sheet shows severe financial distress with zero equity and volatile asset-liability management, posing significant risks for the company's future sustainability.Income Statement
The income statement shows a significant decline in revenue from 2019 to 2024. Gross profit and EBIT margins have deteriorated, resulting in negative gross profit in 2024. Despite a positive net income in 2024 due to extraordinary items, the core operations show weakness. Revenue growth rates are negative, indicating declining sales over the years, which is concerning for stability and long-term growth.30
Negative
Balance Sheet
The balance sheet reflects instability with negative equity in 2024. Debt-to-equity ratios are uncalculable due to zero stockholders' equity, highlighting a risk of insolvency. Assets and liabilities have fluctuated significantly, showing a lack of stability in financial positions over the years. Equity has eroded, emphasizing financial vulnerabilities.20
Very Negative
Cash Flow
Cash flow analysis reveals declining free cash flow and operating cash flow from 2019 to 2024. The free cash flow to net income ratio is negative due to substantial capital expenditures, indicating poor cash generation relative to profit. The operating cash flow to net income ratio has also worsened, reflecting inefficiencies in converting income to cash.40
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 328.06M | 287.38M | 267.37M | 245.24M | 220.78M | Gross Profit |
| 199.95M | 181.28M | 159.82M | 142.94M | 132.57M | EBIT |
| -28.59M | 9.62M | 5.03M | 13.00M | -1.15M | EBITDA |
| 76.32M | 78.27M | 67.43M | 60.91M | 46.44M | Net Income Common Stockholders |
| 190.39M | 8.04M | -8.38M | 7.93M | 2.63M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 46.27M | 139.25M | 44.06M | 84.34M | 195.40M | Total Assets |
| 1.74B | 1.21B | 977.72M | 890.73M | 2.03B | Total Debt |
| 432.30M | 352.73M | 128.26M | 56.62M | 738.02M | Net Debt |
| 386.03M | 213.48M | 84.20M | -27.72M | 542.62M | Total Liabilities |
| 739.23M | 561.56M | 339.71M | 248.46M | 1.45B | Stockholders Equity |
| 918.58M | 652.67M | 638.01M | 642.27M | 582.39M |
| Cash Flow | Free Cash Flow | |||
| -256.50M | -142.78M | -114.71M | -411.04M | 166.30M | Operating Cash Flow |
| 62.57M | 113.77M | 74.89M | -250.93M | 302.87M | Investing Cash Flow |
| -339.41M | -236.69M | -184.18M | 1.78B | -155.59M | Financing Cash Flow |
| 183.86M | 218.11M | 69.00M | -1.64B | -53.53M |
Shenandoah Telecommunications Co Technical Analysis
Neutral
11.37
Price Trends
11.65
Negative
12.60
Negative
14.51
Negative
Market Momentum
-0.18
Negative
50.80
Neutral
65.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHEN, the sentiment is Neutral. The current price of 11.37 is above the 20-day moving average (MA) of 11.33, below the 50-day MA of 11.65, and below the 200-day MA of 14.51, indicating a neutral trend. The MACD of -0.18 indicates Negative momentum. The RSI at 50.80 is Neutral, neither overbought nor oversold. The STOCH value of 65.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SHEN.
Shenandoah Telecommunications Co Risk Analysis
Shenandoah Telecommunications Co disclosed 31 risk factors in its most recent earnings report. Shenandoah Telecommunications Co reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Shenandoah Telecommunications Co Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $874.17M | 16.28 | 130.82% | ― | -0.79% | -64.40% | |
65 Neutral | $5.40B | ― | -0.85% | ― | -3.48% | -169.60% | |
65 Neutral | $3.69B | ― | -0.55% | 0.90% | -3.80% | 83.27% | |
59 Neutral | $30.54B | 0.25 | -13.23% | 4.04% | 2.36% | -49.53% | |
52 Neutral | $256.64M | ― | -5.13% | 5.65% | -1.03% | -204.03% | |
48 Neutral | $4.88B | ― | -12.49% | ― | -9.95% | 99.47% | |
41 Neutral | $610.15M | ― | -4.05% | 0.90% | 14.16% | -443.30% |
* Communication Services Sector Average
Performance Comparison
SHEN
Shenandoah Telecommunications Co
11.37
-7.01
-38.14%
ATNI
ATN International
18.13
-12.79
-41.36%
LUMN
Lumen Technologies
5.16
3.43
198.27%
USM
United States Cellular
64.44
29.61
85.01%
GOGO
Gogo
7.05
-1.81
-20.43%
TDS
Telephone & Data Systems
34.88
19.61
128.42%
Shenandoah Telecommunications Co Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -3.81% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant achievements in system integration and growth expansion, particularly with Glo Fiber, contributing to strong revenue gains. However, challenges such as the T-Mobile revenue churn and declines in incumbent broadband markets posed concerns. Overall, the positive aspects of growth and successful integration efforts slightly outweigh the negative impacts.Highlights
Successful Horizon Integration and Increased Synergy Savings
Completed integration of six back-office systems in nine months, three months ahead of schedule. Increased annual run rate synergy savings from $9.6 million to $13.8 million.
Glo Fiber Expansion and Customer Growth
Achieved fourth consecutive year of increased construction pace and customer net additions. New passings released to sales were approximately 97,000 with customer net additions over 21,000.
Revenue and Growth Metrics
Revenue grew 22% to $328.1 million in 2024. Glo Fiber revenue grew $21.4 million or 61% driven by a 50.9% increase in subscribers and a 7.3% increase in ARPU.
Increased Fiber Network Passings
In 2024, over 103,000 new fiber passings added and more than 1,400 new route miles of fiber. Total fiber passings now at 585,000, with 61% served via fiber.
Lowlights
T-Mobile Revenue Churn
Commercial revenue declined $5.8 million due to $7.1 million in expected T-Mobile revenue churn as part of the Sprint network decommissioning.
Incumbent Broadband Markets Decline
Incumbent Broadband Markets revenue declined $5 million due to a 16.9% decline in video RGUs from cord cutting and a 1.6% decline in data RGUs.
Horizon Revenue Adjustment
Fourth quarter measurement period adjustment to Horizon's commercial revenues of negative $2.6 million, impacting deferred revenue.
Company Guidance
During the Shenandoah Telecommunications Fourth Quarter 2024 Earnings Conference Call, guidance outlined several key financial metrics and strategic expectations. The company reported a 22% increase in revenue to $328.1 million for 2024, with a significant contribution from the newly acquired Horizon markets, which added $47.7 million in revenue. The Glo Fiber business exhibited robust growth, with revenues up by 61% due to a 50.9% rise in subscribers and a 7.3% increase in ARPU. The company successfully integrated Horizon’s systems three months ahead of schedule, boosting annual run rate synergy savings from $9.6 million to $13.8 million. Adjusted EBITDA increased by 20% to $94.6 million, and liquidity stood at $400 million by year-end. Looking ahead, Shentel anticipates Glo Fiber to drive growth, projecting customer net additions and revenue increases for the next six to seven years, with penetration levels expected to rise from 19% to approximately 37%. Capital expenditures in 2024 totaled $300 million, with plans to invest $250 million to $280 million in 2025, focusing on expanding fiber networks. The company expects capital intensity to decline significantly post-2026 as they complete major fiber expansion projects.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.