Cogent Communications (NASDAQ:CCOI) Shares Gap Down - Here's Why

Key Points

• Shares plunged about 34.5%, gapping down from a $23.16 close to a $16.49 open and last trading around $15.35 on heavy volume.
• Several analysts trimmed price targets (e.g., KeyCorp to $25, Oppenheimer to $30, Wells Fargo to $23) and the consensus rating is an average "Hold" with a $26.67 average price target; Weiss Ratings moved the stock deeper into a sell category.
• Cogent beat on quarterly EPS (‑$0.83 vs. a ‑$1.03 estimate) but missed revenue slightly and remains unprofitable (negative net margin and ROE), with analysts forecasting a full‑year EPS of about ‑3.66.

Cogent Communications Holdings, Inc. (NASDAQ:CCOI - Get Free Report) gapped down before the market opened on Monday . The stock had previously closed at $23.16, but opened at $16.49. Cogent Communications shares last traded at $15.3450, with a volume of 963,679 shares traded.

Analyst Upgrades and Downgrades

Several analysts have issued reports on CCOI shares. KeyCorp dropped their price target on shares of Cogent Communications from $30.00 to $25.00 and set an "overweight" rating on the stock in a research report on Monday, February 23rd. Williams Trading set a $40.00 price objective on shares of Cogent Communications in a research report on Monday, February 23rd. Oppenheimer dropped their price objective on shares of Cogent Communications from $40.00 to $30.00 and set an "outperform" rating on the stock in a research report on Monday, February 23rd. Wells Fargo & Company dropped their price objective on shares of Cogent Communications from $27.00 to $23.00 and set an "equal weight" rating on the stock in a research report on Thursday, March 5th. Finally, Weiss Ratings lowered shares of Cogent Communications from a "sell (d-)" rating to a "sell (e+)" rating in a research report on Wednesday, April 22nd. Three research analysts have rated the stock with a Buy rating, seven have given a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, the company has an average rating of "Hold" and an average price target of $26.67.

Cogent Communications Trading Down 34.5%

The business's 50 day moving average price is $20.75 and its two-hundred day moving average price is $24.01. The company has a market capitalization of $758.89 million, a price-to-earnings ratio of -3.96 and a beta of 0.85.

Cogent Communications (NASDAQ:CCOI - Get Free Report) last posted its quarterly earnings results on Monday, May 4th. The technology company reported ($0.83) earnings per share for the quarter, beating analysts' consensus estimates of ($1.03) by $0.20. Cogent Communications had a negative net margin of 18.67% and a negative return on equity of 842.48%. The company had revenue of $239.19 million for the quarter, compared to the consensus estimate of $241.31 million. During the same period last year, the company posted ($1.09) EPS. The firm's quarterly revenue was down 3.2% compared to the same quarter last year. Analysts expect that Cogent Communications Holdings, Inc. will post -3.66 EPS for the current year.

Cogent Communications Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Friday, March 20th. Stockholders of record on Friday, March 6th were paid a $0.02 dividend. This represents a $0.08 dividend on an annualized basis and a dividend yield of 0.5%. The ex-dividend date was Friday, March 6th. Cogent Communications's dividend payout ratio (DPR) is presently -2.10%.

Insider Activity at Cogent Communications

In related news, VP Henry W. Kilmer sold 2,400 shares of the firm's stock in a transaction that occurred on Friday, March 6th. The shares were sold at an average price of $23.35, for a total value of $56,040.00. Following the completion of the transaction, the vice president owned 41,000 shares in the company, valued at $957,350. This trade represents a 5.53% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Sheryl Lynn Kennedy sold 3,300 shares of the firm's stock in a transaction that occurred on Thursday, March 5th. The shares were sold at an average price of $22.99, for a total transaction of $75,867.00. Following the completion of the transaction, the director owned 10,100 shares of the company's stock, valued at approximately $232,199. This trade represents a 24.63% decrease in their position. The SEC filing for this sale provides additional information. In the last quarter, insiders have sold 12,756 shares of company stock valued at $292,467. 4.20% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

Large investors have recently added to or reduced their stakes in the business. Vanguard Group Inc. raised its holdings in Cogent Communications by 5.3% in the 3rd quarter. Vanguard Group Inc. now owns 5,362,821 shares of the technology company's stock valued at $205,664,000 after buying an additional 270,975 shares during the last quarter. ProShare Advisors LLC raised its holdings in Cogent Communications by 30.1% during the 3rd quarter. ProShare Advisors LLC now owns 177,113 shares of the technology company's stock worth $6,792,000 after purchasing an additional 40,970 shares during the last quarter. Arvin Capital Management LP bought a new position in Cogent Communications during the 3rd quarter worth approximately $2,301,000. Boothbay Fund Management LLC raised its holdings in Cogent Communications by 123.4% during the 3rd quarter. Boothbay Fund Management LLC now owns 312,626 shares of the technology company's stock worth $11,989,000 after purchasing an additional 172,676 shares during the last quarter. Finally, Tyro Capital Management LLC raised its holdings in Cogent Communications by 46.9% during the 3rd quarter. Tyro Capital Management LLC now owns 935,287 shares of the technology company's stock worth $35,868,000 after purchasing an additional 298,392 shares during the last quarter. Institutional investors own 92.45% of the company's stock.

Cogent Communications Company Profile

Cogent Communications NASDAQ: CCOI is a multinational Internet service provider specializing in high-speed Internet access and data transport services. The company operates one of the largest Tier 1 IP networks in the world, offering wholesale and enterprise customers reliable, low-latency connectivity. Cogent's core services include dedicated Internet access, Ethernet transport, wavelength services, and MPLS-based IP Virtual Private Networks, all delivered over its privately owned, fiber-optic backbone.

In addition to network connectivity, Cogent provides data center colocation and managed services designed to support businesses with demanding bandwidth and redundancy requirements.

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