Simply Wall St's estimated fair value for Cogent Communications Holdings has been cut from US$21.27 to US$15.27, a drop of around 28%, following more cautious analyst commentary after the company's second quarter. JPMorgan moved Cogent to Underweight from Neutral and reduced its price target to US$9 from US$22, citing slower wave installation, softer revenue and EBITDA, and continued sales pressure linked to legacy Sprint contract runoff. UBS, Citi, RBC Capital and Goldman Sachs each cut price targets into an US$11 to US$12 range after Q2, with updates citing revenue and EBITDA shortfalls, a wavelength miss, higher costs and execution questions in the Waves and remaining datacenter sales processes. The valuation model's projected revenue growth rate has shifted from 7.27% to about 6.51%, the assumed net profit margin from 12.93% to about 8.85%, the future P/E ratio from 9.88x to about 11.33x, and the discount rate from 11.18% to 12.54%. Goldman Sachs noted that Cogent's long term growth and margin targets remain intact even as it acknowledged a challenging Q2 backdrop.
Citigroup Inc.
JPMorgan Chase & Co
Cogent Communications Group Inc
China Mobile Limited
