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Uniti Group Inc (UNIT)
NASDAQ:UNIT
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Uniti Group
(NASDAQ:UNIT)
55Neutral
Positive Factors
Fiber Demand
Fiber demand remains tariff and recessionary resistant with a strong lease-up mix.
Growth Potential
Kinetic plans to accelerate its FTTH deployment, aiming to reach 2 million homes earlier than planned, signaling growth potential.
Market Expansion
Uniti sees significant future growth in the Fiber Network market, with the total addressable market expected to increase to $50B by 2030.
Negative Factors
Financial Guidance
UNIT traded lower after reporting mixed financials and lowering its guide for net income attributable to common shareholders and FFO.
Interest Expense
Interest expense guidance was increased by $3mn and net income attributable to common shareholders was reduced 4.7% at the mid-point.
Wireless Bookings
Wireless bookings came in flat for 2024, which was below management's expectations.
Uniti Group (UNIT) vs. S&P 500 (SPY)
Market Cap
$1.14B
Dividend Yield3.23%
Average Volume (3M)2.27M
Price to Earnings (P/E)17.7
Beta (1Y)0.93
Revenue Growth2.44%
EPS Growth305.26%
CountryUS
Employees758
SectorReal Estate
Sector Strength68
IndustryREIT - Specialty
Share Statistics
EPS (TTM)0.05
Shares Outstanding245,453,410
10 Day Avg. Volume2,570,104
30 Day Avg. Volume2,270,861
Financial Highlights & Ratios
PEG Ratio-0.11
Price to Book (P/B)-0.44
Price to Sales (P/S)0.00
P/FCF Ratio93.54
Enterprise Value/Market Cap6.00
Enterprise Value/Revenue1.39
Enterprise Value/Gross Profit8.76
Enterprise Value/Ebitda1.95
Forecast
1Y Price Target
$6.36Price Target Upside39.78% Upside
Rating ConsensusHold
Number of Analyst Covering5
Uniti Group Business Overview & Revenue Model
Company DescriptionUniti Group Inc. (UNIT) is a real estate investment trust (REIT) focused on the acquisition and construction of mission-critical communications infrastructure in the United States. The company primarily operates in the telecommunications sector, providing high-speed broadband infrastructure solutions, including fiber optic cables, wireless tower infrastructure, and other network solutions. Uniti Group's core services are designed to support the growing demand for data and connectivity, catering to various telecommunications companies and service providers.
How the Company Makes MoneyUniti Group Inc. generates revenue primarily through leasing its communications infrastructure assets, such as fiber networks and wireless towers, to telecommunications companies and service providers. The company's revenue model is based on long-term lease agreements, which provide predictable and stable cash flows. Key revenue streams include lease payments from tenants who utilize Uniti's fiber networks and tower sites to deliver broadband and wireless services. Additionally, Uniti may engage in strategic partnerships and joint ventures to expand its infrastructure and service offerings, further contributing to its earnings. The company also explores opportunities for growth through acquisitions and development of new infrastructure to meet the increasing demand for high-capacity communication networks.
Uniti Group Financial Statement Overview
Summary
Uniti Group exhibits a mixed financial performance with solid revenue growth and operational margins. However, profitability concerns and negative equity highlight financial instability risks. Improvements in cash flow management are encouraging, yet the balance sheet structure remains a significant concern. The company needs to address its leverage and profitability issues for a healthier financial outlook.Income Statement
Uniti Group has demonstrated a steady growth in revenues with a CAGR over the years. The gross and EBIT margins are healthy, indicating solid operational efficiency. However, the net income remains volatile, with significant fluctuations, indicating underlying profitability issues. The company has shown improvement in profitability with a net income turning positive in 2024 compared to losses in previous years.65
Positive
Balance Sheet
The balance sheet reflects a concerning financial structure with negative stockholders' equity, driven by high liabilities. Despite this, the reduction in total debt in 2024 is notable. The debt-to-equity ratio is not applicable due to negative equity. The equity ratio is negative, highlighting potential financial instability.45
Neutral
Cash Flow
Uniti Group shows a positive trend in operating cash flows, indicating good cash generation capacity. Free cash flow has improved significantly in 2024, turning positive, showing better capital management. The operating cash flow to net income ratio is solid, but the volatile net income affects free cash flow ratios, highlighting cash flow sustainability risks.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.17B | 1.15B | 1.13B | 1.10B | 1.07B | Gross Profit |
| 711.74M | 695.03M | 1.12B | 1.10B | 907.70M | EBIT |
| 606.72M | 578.38M | 599.21M | 542.98M | 461.62M | EBITDA |
| 882.80M | 642.35M | 891.99M | 833.92M | 92.42M | Net Income Common Stockholders |
| 91.31M | -81.71M | -10.49M | 123.66M | -718.91M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 155.59M | 62.26M | 43.80M | 58.90M | 77.53M | Total Assets |
| 5.28B | 5.03B | 4.85B | 4.81B | 4.73B | Total Debt |
| 5.88B | 5.63B | 5.27B | 5.11B | 4.83B | Net Debt |
| 5.73B | 5.56B | 5.23B | 5.05B | 4.75B | Total Liabilities |
| 7.73B | 7.51B | 7.12B | 6.92B | 6.80B | Stockholders Equity |
| -2.45B | -2.49B | -2.27B | -2.13B | -2.14B |
| Cash Flow | Free Cash Flow | |||
| 11.86M | -63.87M | 32.55M | 113.30M | -159.85M | Operating Cash Flow |
| 366.69M | 353.13M | 460.12M | 499.16M | 157.23M | Investing Cash Flow |
| -272.20M | -411.31M | -392.02M | -321.22M | 1.39M | Financing Cash Flow |
| 27.08M | 76.64M | -78.58M | -196.57M | -223.91M |
Uniti Group Technical Analysis
Negative
4.55
Price Trends
4.78
Negative
5.16
Negative
5.22
Negative
Market Momentum
-0.04
Negative
44.72
Neutral
62.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UNIT, the sentiment is Negative. The current price of 4.55 is below the 20-day moving average (MA) of 4.72, below the 50-day MA of 4.78, and below the 200-day MA of 5.22, indicating a bearish trend. The MACD of -0.04 indicates Negative momentum. The RSI at 44.72 is Neutral, neither overbought nor oversold. The STOCH value of 62.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for UNIT.
Uniti Group Risk Analysis
Uniti Group disclosed 33 risk factors in its most recent earnings report. Uniti Group reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Uniti Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $1.03B | 6.13 | 10.81% | ― | -5.60% | -17.86% | |
63 Neutral | $1.14B | 9.41 | 8.09% | 10.40% | 7.13% | 64.82% | |
60 Neutral | $1.12B | 10.59 | 4.51% | 4.52% | 1.54% | ― | |
60 Neutral | $2.82B | 10.29 | 0.31% | 8508.26% | 5.91% | -17.42% | |
60 Neutral | $1.34B | 16.28 | 6.01% | 13.32% | 73.74% | -34.10% | |
56 Neutral | $964.34M | 17.23 | 5.07% | 12.31% | -6.28% | -49.57% | |
55 Neutral | $1.14B | 17.70 | -3.72% | 3.23% | 2.44% | 305.26% |
* Real Estate Sector Average
Performance Comparison
UNIT
Uniti Group
4.55
1.11
32.27%
CIM
Chimera Investment
13.91
2.07
17.48%
DX
Dynex Capital
12.49
1.55
14.17%
FOR
Forestar Group
19.88
-14.80
-42.68%
SAFE
Safehold
15.61
-4.11
-20.84%
FBRT
Franklin BSP Realty Trust
11.43
-0.29
-2.47%
Uniti Group Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q1-2025)
| % Change Since: -9.00%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook with strong quarterly performance, significant progress in fiber expansion, and positive developments regarding the merger with Windstream. These factors contribute to an optimistic future outlook despite minor challenges such as non-recurring revenue delays and broader economic risks.Q1-2025 Updates
Positive Updates
Strong Quarterly Performance
Uniti achieved mid-single digits top-line growth and high single-digit adjusted EBITDA growth, reiterating full-year revenue, adjusted EBITDA, and AFFO guidance. Consolidated revenues were $294 million, and adjusted EBITDA was $238 million.
Significant Progress in Fiber Expansion
Fiber expansion within the Kinetic footprint is expected to double the number of homes passed, reaching 2 million homes by the end of the year, two years earlier than expected.
High Lease-Up Success
The lease-up rate reached 72%, nearing company records, with significant contributions from hyperscalers.
Positive Market and Regulatory Developments
Favorable regulatory changes at the FCC and NTIA, supporting fiber infrastructure growth with relaxed rules on retiring copper networks and streamlined permitting processes.
Merger with Windstream Progress
Received shareholder and PUC approvals for the merger with Windstream, with expectations to close by July or August. Approximately 97% of shareholders supported the transaction.
Improved Cost of Capital
Uniti's cost of capital improved significantly, with debt yields decreasing from over 12% to around 7.5% over two years.
Negative Updates
Non-Recurring Revenue Delay
Uniti Fiber experienced lower than expected non-recurring revenue due to a delay in a $4 million fiber sale to a government customer.
Capital Markets Volatility
Despite resilience in the ABS market, broader capital markets remain volatile, posing potential risks.
Tariff and Economic Risks
Potential impact of proposed tariff changes and increased recession risk, though expected to have minimal direct effect on operations.
Company Guidance
In the first quarter of 2025, Uniti achieved strong performance and maintained its guidance for full-year revenue, adjusted EBITDA, and AFFO, despite broader market volatility. The company anticipates mid-single-digit top-line growth and high single-digit adjusted EBITDA growth for the year. Uniti's plan to fund new initiatives remains on track, with significant progress noted in the expansion of fiber within the Kinetic footprint, aiming to reach 2 million homes by the end of the year. The merger with Windstream, which received 97% shareholder approval and 16 of 18 required PUC approvals, is expected to close in the second half of 2025. Uniti's consolidated revenues for Q1 were $294 million, with an adjusted EBITDA of $238 million and AFFO per diluted share of $0.35. The company expects full-year consolidated revenue and adjusted EBITDA to remain within the projected ranges, with anticipated AFFO per diluted share between $1.40 and $1.47, representing a 6% increase from the previous year.Uniti Group Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Uniti Group Progresses Towards Merger with Windstream
Positive
May 1, 2025
Windstream Holdings II, LLC, a successor to Windstream Holdings, Inc., reported its financial results for the quarter ending March 31, 2025. The company highlighted a continued expansion of its fiber network, with 38,000 new premises constructed, increasing fiber coverage to 38% in its Kinetic markets. Fiber subscriber growth was robust, with a 16% year-over-year increase, and fiber penetration reached 28%. The company also reported a 20% year-over-year growth in fiber subscriber revenue. Additionally, Windstream completed a sale of IPv4 assets for over $25 million and achieved an adjusted EBITDAR of $370 million, up $40 million sequentially. The company is progressing towards a planned merger with Uniti Group, expected to close in the early second half of 2025.
Spark’s Take on UNIT Stock
According to Spark, TipRanks’ AI Analyst, UNIT is a Neutral.
Uniti Group’s overall stock score reflects mixed financial performance with strong revenue growth but ongoing profitability and balance sheet challenges. The technical analysis suggests bearish trends, while the valuation appears attractive with a high dividend yield. The positive earnings call highlights strategic growth and future prospects, offering optimism despite existing financial concerns.
To see Spark’s full report on UNIT stock, click here.
Executive/Board ChangesBusiness Operations and Strategy
Uniti Group Approves New Equity Grant Agreements
Neutral
Apr 17, 2025
On April 16, 2025, Uniti Group‘s Board approved new grant agreements for restricted shares and stock unit awards under its 2015 Equity Incentive Plan, aligning terms for vesting upon retirement, death, disability, and changes in control. Additionally, Harold Zeitz was nominated for election to the Board, bringing extensive industry experience, while Jennifer Banner will not seek re-election after a decade of service.
Spark’s Take on UNIT Stock
According to Spark, TipRanks’ AI Analyst, UNIT is a Neutral.
Uniti Group’s overall stock score of 65 reflects a balance of strengths and weaknesses. The company’s robust revenue growth, operational efficiency, and attractive dividend yield are offset by its financial instability due to high liabilities and negative equity. Technical indicators point to a neutral to slightly bearish sentiment in the market. The earnings call provided a positive outlook with strategic initiatives and growth plans, contributing positively to the score.
To see Spark’s full report on UNIT stock, click here.
Private Placements and FinancingM&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Uniti Group Reports Strong 2024 Financial Results and Merger Plans
Positive
Feb 21, 2025
Uniti Group Inc. announced its fourth quarter and full year 2024 financial results, highlighting a net income of $93.4 million for the full year and a significant revenue boost from its fiber and leasing segments. The company also completed a notable ABS financing transaction to strengthen its balance sheet and reduce debt costs, setting the stage for its anticipated merger with Windstream in the second half of 2025. This merger is expected to enhance Uniti’s positioning in the communications industry by leveraging synergies and expanding its fiber infrastructure capabilities.
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.