CenturyLink, Inc. (CTL), Frontier Communications Corp (FTR), Windstream Corporation (WIN): Four Reasons To Link Up To This High-Yield Stock

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Less in interest payments means CenturyLink has relatively more money for dividends and share repurchases. It makes sense that CenturyLink used just 47.32% of their core free cash flow (net income + depreciation – capital expenditures) on dividend payments in the last six months. Frontier pays a higher yield, but the company’s cash flow payout reflects this with a percentage of 69.56% covering the dividend. Unfortunately for Windstream Corporation (NASDAQ:WIN) investors, their company’s payout ratio was 103.35%.

Pick up this value
As you can see, CenturyLink is outperforming its peers in key categories of its operation. While the stock doesn’t have the highest yield, the recent decline gives investors a yield of more than 6.5%. The company has the lowest forward P/E ratio of the group at just over 12 times projected earnings as well.

A dividend cut is always painful, but it seems CenturyLink’s management was being prudent, and is following through with their share repurchase plan. A strong dividend, low P/E, good organic results, and a continued share buyback program sounds like an opportunity ringing in investors’ ears. Make sure you answer the call, and pick up this value while you can.

The article 4 Reasons To Link Up To This High-Yield Stock originally appeared on Fool.com and is written by Chad Henage.

Chad Henage owns shares of CenturyLink. The Motley Fool has no position in any of the stocks mentioned.

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