Topics Growth Stocks

ATN International $81.87 - Nasdaq symbol ATNI

ATN INTERNATIONAL $81.87 (Nasdaq symbol ATNI; TSINetwork Rating: Speculative) (340-777-8000; www.atni.com; Shares outstanding: 16.1 million; Market cap: $1.3 billion; Dividend yield: 1.6%) (formerly Atlantic Tele- Network) owns wireless and wireline (traditional telephone and Internet) operations in the U.S. Southwest, New England, New York State, Bermuda, parts of the Caribbean and Guyana.

It also owns solar power plants in the U.S. and India, which sell electricity under long-term contracts.

In the three months ended March 31, 2016, the company’s revenue rose 5.1%, to $89.7 million from $85.3 million a year earlier. Earnings per share excluding one-time items, were $0.54 in the latest quarter, down 10.0% from $0.60. The decline was mostly due to the cost of integrating acquisitions.

ATN has just completed the $145 million purchase of the Innovative Group of Companies. It provides cable TV, Internet and traditional phone services primarily in the U.S. Virgin Islands.

ATN can well afford this acquisition—it holds cash of $391.1 million, or $24.29 a share, and has low debt. The company is planning to use some of its remaining cash to expand its renewable power business. The move will add diversification, but entering markets beyond its telecom expertise also adds risk. That’s especially true in volatile political markets such as India.

Meanwhile, the stock trades at a high 30.9 times the $2.65 a share Atlantic is forecast to earn in 2016.

ATN International is a hold.

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