Citi has reinitiated its coverage of Uniti Group (UNIT, Financial) with a Neutral stance, setting a target price at $5.30. Analysts express optimism about the high probability of Uniti’s merger with Windstream being finalized. They note that while this merger could enhance Uniti's capacity to invest in its strategic areas, Windstream is still dealing with challenges rooted in its past operations.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 6 analysts, the average target price for Uniti Group Inc (UNIT, Financial) is $6.05 with a high estimate of $9.00 and a low estimate of $3.50. The average target implies an upside of 24.74% from the current price of $4.85. More detailed estimate data can be found on the Uniti Group Inc (UNIT) Forecast page.
Based on the consensus recommendation from 6 brokerage firms, Uniti Group Inc's (UNIT, Financial) average brokerage recommendation is currently 2.7, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Uniti Group Inc (UNIT, Financial) in one year is $14.27, suggesting a upside of 194.23% from the current price of $4.85. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Uniti Group Inc (UNIT) Summary page.
UNIT Key Business Developments
Release Date: May 06, 2025
- Consolidated Revenue: $294 million for Q1 2025.
- Consolidated Adjusted EBITDA: $238 million for Q1 2025.
- AFFO Attributed to Common Shareholders: $92 million for Q1 2025.
- AFFO Per Diluted Common Share: $0.35 for Q1 2025.
- Uniti Leasing Revenue: $222 million for Q1 2025.
- Uniti Leasing Adjusted EBITDA: $215 million, with a margin of 97% for Q1 2025.
- Uniti Fiber Revenue: $72 million for Q1 2025.
- Uniti Fiber Adjusted EBITDA: $29 million, with a margin of 40% for Q1 2025.
- Net Success-Based CapEx for Uniti Leasing: $170 million for Q1 2025.
- Net Success-Based CapEx for Uniti Fiber: $18 million for Q1 2025.
- 2025 Revenue Guidance for Uniti Leasing: $902 million at the midpoint.
- 2025 Adjusted EBITDA Guidance for Uniti Leasing: $872 million at the midpoint.
- 2025 Revenue Guidance for Uniti Fiber: $304 million at the midpoint.
- 2025 Adjusted EBITDA Guidance for Uniti Fiber: $125 million at the midpoint, with a margin of approximately 41%.
- Full-Year AFFO Guidance: $1.40 to $1.47 per diluted common share, with a midpoint of $1.43.
- Leverage Ratio: 6.09 times based on net debt to annualized adjusted EBITDA for Q1 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Uniti Group Inc (UNIT, Financial) reported strong first-quarter performance with mid-single-digit top-line growth and high-single-digit adjusted EBITDA growth.
- The company reiterated its full-year revenue, adjusted EBITDA, and AFFO guidance, indicating confidence in its financial outlook.
- Uniti Group Inc (UNIT) is making significant progress in expanding its fiber network, with plans to double the number of homes passed with fiber by the end of 2025.
- The merger with Windstream received overwhelming shareholder approval, with 97% of voting shareholders in favor, and is on track to close in the second half of the year.
- The company is experiencing strong demand from wireless carriers and hyperscalers, with bookings almost doubling compared to the same quarter last year.
Negative Points
- The company faces potential risks from proposed tariff changes, although it currently anticipates little to no effect on its business.
- There is increased volatility in capital markets and a risk of recession, which could impact the company's financial performance.
- Non-recurring revenue at Uniti Fiber was lower than expected due to a delay in a $4 million one-time sale of fiber to a government customer.
- The cost of capital has been volatile, although it remains better compared to levels prior to the merger announcement with Windstream.
- The company is still in a large investment period for learning models, which may not be fully reflected in current bookings.
