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Liberty Global LiLAC A (NASDAQ:LILA) shares have tumbled to a 52-week low, touching $5.91 amidst market fluctuations. According to InvestingPro data, the stock has fallen nearly 37% over the past six months, though analysis suggests the shares are currently undervalued. This latest price point underscores a challenging period for the telecommunications company, though there are bright spots in its fundamentals, including an impressive 77.8% gross profit margin. While the company isn’t currently profitable, analysts predict a return to profitability this year with a forecasted EPS of $0.72. Investors are closely monitoring the company’s performance, as it navigates through competitive pressures and seeks to implement strategies that could potentially reverse the downward trend and restore shareholder confidence.
In other recent news, Liberty LiLAC has experienced significant developments affecting its financial outlook. Barclays (LON:BARC) analyst Mathieu Robilliard downgraded Liberty LiLAC’s stock rating from Equalweight to Underweight, with a revised price target of $6.50, down from $8.00. This adjustment reflects ongoing challenges in Puerto Rico that have adversely impacted the company’s performance over the past two years. Liberty LiLAC’s adjusted Operating Income Before Depreciation and Amortization (OIBDA) decreased by 7% year-over-year on a rebased scale in 2024, leading to an increased leverage of 4.5 times by the end of 2024, which is higher than its regional peers. Robilliard expressed concerns over the company’s high leverage strategy amidst regional economic, climatic, and political volatility. Although an increase in free cash flow is anticipated for 2025, this growth is partly attributed to reduced capital expenditures, which might not be sustainable long-term. Barclays now forecasts a 2% compound annual growth rate in adjusted OIBDA from 2023 to 2026, below the company’s guidance of mid to high single-digit growth. Despite this, Barclays expects Liberty LiLAC to generate free cash flow consistent with the company’s guidance, around $1 billion during this period.
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