Analysts See Broadband-Driven Growth for WideOpenWest
WideOpenWest's move from a video focus to being broadband-centric should drive financial results, analysts wrote investors Monday as they initiated coverage after WOW's initial public offering last month. Credit Suisse's Omar Sheikh said its high-speed data business will be powered…
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in part by WOW's fiber network, its edge-out investments to expand its footprint and its ability to lure business customers from telco incumbents. He said WOW's chief risk is Comcast and Charter Communications price competition. Macquarie's Amy Yong said lesser regulatory restrictions faced by overbuilders like WOW give it the ability to jump on growth opportunities in and adjacent to its footprint. Yong said margins should improve as video penetration declines and high-speed data rises. She said WOW's competitive edges include "local-level flexibility" that lets it compete against telecom and cable pricing, with WOW typically pricing about 10 percent below multi-service operator competitors. Raymond James' Frank Louthan said the company "has a significant opportunity to pursue additional customer acquisitions through relatively low risk, edge-out opportunities."