Cogent Communications (NASDAQ:CCOI) Lowered to Neutral Rating by Citigroup

Key Points

• Citigroup downgraded Cogent Communications from a "buy" to a "neutral" rating, reducing its price target from $67.00 to $33.00, indicating a potential upside of just 1.98% from current prices.
• Cogent reported a loss of ($1.21) EPS for the last quarter, missing estimates and showing a decline in revenue of 5.4% year-over-year.
• The company has initiated a stock repurchase program allowing it to buy back $100 million worth of shares, which signifies management's belief that its stock is undervalued.

Citigroup downgraded shares of Cogent Communications (NASDAQ:CCOI - Free Report) from a buy rating to a neutral rating in a report published on Tuesday, MarketBeat Ratings reports. They currently have $33.00 price target on the technology company's stock, down from their previous price target of $67.00.

CCOI has been the topic of several other reports. UBS Group reduced their target price on Cogent Communications from $102.00 to $75.00 and set a "buy" rating on the stock in a report on Friday, May 9th. The Goldman Sachs Group lowered their price target on shares of Cogent Communications from $71.00 to $62.00 and set a "neutral" rating on the stock in a research report on Friday, May 9th. Finally, Royal Bank Of Canada reissued a "sector perform" rating and set a $40.00 price objective (down from $74.00) on shares of Cogent Communications in a report on Friday, August 8th. Two investment analysts have rated the stock with a sell rating, three have issued a hold rating and two have issued a buy rating to the company. According to data from MarketBeat.com, Cogent Communications currently has an average rating of "Hold" and a consensus price target of $60.83.

Cogent Communications Trading Up 0.3%

Shares of Cogent Communications stock traded up $0.11 during mid-day trading on Tuesday, hitting $34.25. 1,245,888 shares of the stock were exchanged, compared to its average volume of 1,585,489. The stock has a market capitalization of $1.68 billion, a price-to-earnings ratio of -7.54 and a beta of 0.68. The company has a current ratio of 2.31, a quick ratio of 2.31 and a debt-to-equity ratio of 49.06. Cogent Communications has a twelve month low of $29.61 and a twelve month high of $86.76. The company has a 50-day simple moving average of $46.41 and a 200 day simple moving average of $56.58.

Cogent Communications (NASDAQ:CCOI - Get Free Report) last issued its earnings results on Thursday, August 7th. The technology company reported ($1.21) EPS for the quarter, missing the consensus estimate of ($0.93) by ($0.28). Cogent Communications had a negative return on equity of 117.56% and a negative net margin of 21.57%. The firm had revenue of $246.25 million during the quarter, compared to the consensus estimate of $247.79 million. During the same period last year, the business earned ($0.68) earnings per share. The firm's revenue for the quarter was down 5.4% compared to the same quarter last year. Research analysts forecast that Cogent Communications will post -4.55 EPS for the current year.

Cogent Communications announced that its Board of Directors has authorized a stock repurchase program on Thursday, August 7th that allows the company to repurchase $100.00 million in shares. This repurchase authorization allows the technology company to buy up to 4.6% of its stock through open market purchases. Stock repurchase programs are often a sign that the company's leadership believes its shares are undervalued.

Cogent Communications Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Friday, September 5th. Investors of record on Thursday, August 21st will be paid a dividend of $1.015 per share. This represents a $4.06 dividend on an annualized basis and a dividend yield of 11.9%. This is a positive change from Cogent Communications's previous quarterly dividend of $1.01. The ex-dividend date of this dividend is Thursday, August 21st. Cogent Communications's payout ratio is presently -88.99%.

Insider Activity

In other Cogent Communications news, VP Henry W. Kilmer sold 2,400 shares of the business's stock in a transaction on Friday, June 6th. The shares were sold at an average price of $47.95, for a total transaction of $115,080.00. Following the transaction, the vice president directly owned 38,600 shares of the company's stock, valued at approximately $1,850,870. The trade was a 5.85% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, CRO James Bubeck sold 2,000 shares of the firm's stock in a transaction on Wednesday, June 4th. The stock was sold at an average price of $47.50, for a total value of $95,000.00. Following the completion of the sale, the executive directly owned 55,142 shares of the company's stock, valued at $2,619,245. This trade represents a 3.50% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last 90 days, insiders sold 3,105,078 shares of company stock valued at $103,810,876. Company insiders own 11.40% of the company's stock.

Institutional Investors Weigh In On Cogent Communications

Several hedge funds have recently bought and sold shares of CCOI. AlphaQuest LLC purchased a new stake in shares of Cogent Communications during the 1st quarter valued at $36,000. Itau Unibanco Holding S.A. grew its holdings in shares of Cogent Communications by 58.9% during the fourth quarter. Itau Unibanco Holding S.A. now owns 618 shares of the technology company's stock worth $48,000 after buying an additional 229 shares in the last quarter. Farther Finance Advisors LLC increased its stake in shares of Cogent Communications by 297.8% during the second quarter. Farther Finance Advisors LLC now owns 740 shares of the technology company's stock worth $36,000 after buying an additional 554 shares during the period. Resources Management Corp CT ADV acquired a new stake in Cogent Communications in the first quarter valued at $48,000. Finally, Atlantic Union Bankshares Corp purchased a new stake in shares of Cogent Communications during the 2nd quarter worth about $40,000. 92.45% of the stock is currently owned by institutional investors and hedge funds.

About Cogent Communications

Cogent Communications Holdings, Inc, through its subsidiaries, provides high-speed Internet access, private network, and data center colocation space services in North America, Europe, Oceania, South America, and Africa. The company offers on-net Internet access and private network services to law firms, financial services firms, and advertising and marketing firms, as well as heath care providers, educational institutions and other professional services businesses, other Internet service providers, telephone companies, cable television companies, web hosting companies, media service providers, mobile phone operators, content delivery network companies, and commercial content and application service providers.