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Cogent Communications Holdings, Inc. (NASDAQ:CCOI), a key player in communication services with a market capitalization of $3.3 billion, has renewed the lease for its headquarters in Washington, D.C., with a term now extending until May 10, 2030. According to InvestingPro data, the company currently trades above its Fair Value, with a significant 5.75% dividend yield that has been maintained for 14 consecutive years. This announcement follows the company’s entry into a Second Amendment to Lease Agreement with Sodium, LLC, which is owned by Cogent’s CEO, David Schaeffer.
The original lease, initiated on April 16, 2015, was set to expire on May 11, 2020. It was previously extended to May 10, 2025, through a First Amendment. The latest amendment, which carries the lease forward another five years, does not alter any other terms except for the duration. The Audit Committee of the Company’s Board of Directors approved the extension, ensuring compliance with protocols for related party transactions.
Cogent’s headquarters are located at 2450 N Street, NW, occupying approximately 43,117 square feet. The lease agreement continues to allow Cogent the option to terminate without penalty given a 60-day written notice. The fixed annual rent under the lease is approximately $991,691. For deeper insights into Cogent’s financial health and extensive metrics, including 12 additional ProTips and comprehensive valuation analysis, visit InvestingPro.
This lease extension ensures Cogent’s continued presence at its current location for the next several years. The company’s decision to extend the lease was disclosed in a filing with the Securities and Exchange Commission. The information is based on a press release statement and shall not be considered "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor incorporated by reference in any filing under the Securities Act of 1933, except as expressly set forth by specific reference in such a filing.
In other recent news, Cogent Communications reported fourth-quarter revenue of $252.3 million, which fell short of the consensus estimate of $258.04 million. This represents a 1.9% decrease from the previous quarter and a 7.3% decline year-over-year. Despite the revenue miss, the company reported a loss of $0.91 per share, which was better than analysts’ expectations of a $1.22 per share loss. Cogent noted that lower office occupancy rates continue to impact corporate revenue, although some markets show improving trends. On-net revenue decreased by 5.7% to $128.8 million, while off-net revenue increased by 1.7% to $113.2 million. The company saw significant growth in its wavelength and IPv4 leasing businesses, with wavelength revenue increasing 31.8% to $7.0 million and IPv4 leasing revenue rising 11.8% to $12.6 million. Cogent’s board approved a dividend increase to $1.005 per share for the first quarter of 2025, marking its fiftieth consecutive quarterly dividend increase. KeyBanc Capital Markets maintained an Overweight rating on Cogent, with a price target of $91, citing strong EBITDA margin and potential growth catalysts. KeyBanc’s analysis suggests investors consider purchasing Cogent shares during periods of weakness.
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