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Is It Too Late to Buy Lumen Technologies Stock?

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Written by Timothy Sykes Reviewed by Jack Kellogg Fact-checked by Ellis Hobbs

Lumen Technologies Inc. has seen a significant boost in its stock price, trading up by 4.55 percent on Thursday. This surge is likely influenced by recent positive coverage, including strong quarterly earnings reports and key strategic partnerships highlighted in the news. Investors seem optimistic, reflecting increased confidence in the company’s future performance.

Latest Updates

  • Lumen Technologies is implementing Blue Planet Inventory to streamline network inventory and improve operational efficiency.
  • Lumen has announced exchange offers for certain outstanding unsecured senior notes, aiming to issue new superpriority senior secured notes and cash consideration.
  • Lumen is up 9.9%, or 60c to $6.64, signaling a surge in investor confidence.

Candlestick Chart

Live Update at 14:50:21 EST: On Thursday, September 19, 2024 Lumen Technologies Inc. stock [NYSE: LUMN] is trending up by 4.55%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Lumen Technologies’ Recent Financial Performance and Key Metrics

Lumen Technologies, a company that has faced its fair share of turbulence, seems to be on an upward trajectory with its recent initiatives and strategic movements. The company’s financial results have been a mixed bag, reflecting both challenges and opportunities.

Looking at its recent earnings report, for the quarter ending on Jun 30, 2024, Lumen reported an operating revenue of $3.268 billion while its total expenses were at $3.138 billion. This resulted in an operating income of $135 million. Despite this, the net income from continuing operations was a loss of $49 million, indicating ongoing profitability issues.

The latest intraday 5-minute candle chart data reveals a robust upward trend in its stock price. For example, between 15:00 and 15:49, the stock hovered around the $6.67 mark, demonstrating resilience and investor confidence. The stock’s overall movement presents a picture of cautious optimism, with occasional dips but a general upward arc.

Lumen’s key ratios paint a picture of a company grappling with its finances but showing signs of potential turnaround. For instance, the company’s EBIT margin is at -9.4%, and its net income margin stands at -15.06%. Nonetheless, its gross margin is at 49.8%, indicating strong revenue generation ability. The total debt to equity ratio at 40.52 and a quick ratio of 0.8 indicate that the company is managing its liquidity and debt fairly well, though there is significant leverage involved.

Moreover, the company has initiated exchange offers for unsecured senior notes, aiming to issue new superpriority senior secured notes. This move is intended to improve its financial structure, possibly reducing capital costs and extending maturities, which could lead to better financial health in the long run.

How News Impacts LUMN Stock

Blue Planet Inventory Implementation:

The implementation of Blue Planet Inventory is a strategic initiative aimed at enhancing Lumen’s operational efficiency. By streamlining network inventory, Lumen can reduce operational costs and improve service delivery. This technological upgrade is expected to attract new clients and retain existing ones, ultimately boosting the company’s revenue. For investors, such a move signals a commitment to innovation and efficiency, improving investor sentiment and potentially driving stock prices higher.

Senior Notes Exchange Offers:

Lumen’s announcement regarding the exchange offers for certain outstanding unsecured senior notes is a crucial move towards refinancing its debt. By offering newly issued superpriority senior secured notes, Lumen aims to attract more favorable terms and reduce its debt servicing burden. This financial maneuver could be seen as a stabilizing force in the company’s balance sheet, making it more attractive to investors seeking stability in a volatile market.

Positive Stock Movement:

The 9.9% surge in Lumen’s stock price to $6.64 is a testament to the market’s positive reception of the company’s recent announcements. This significant upward movement can be attributed to the optimistic outlook surrounding the company’s strategic initiatives and improved operational framework. For potential investors, the stock’s upward trajectory may be seen as an opportunity to capitalize on the company’s growth prospects.

Conclusion

In summary, Lumen Technologies is navigating through a transformative phase with strategic initiatives aimed at improving operational efficiency and financial stability. The implementation of Blue Planet Inventory and the exchange offers for senior notes are significant steps towards achieving these goals. While the company continues to face profitability challenges, the recent positive stock movement indicates investor confidence in Lumen’s potential for growth and turnaround. As always, prospective investors should conduct thorough research and consider their risk tolerance before making investment decisions.

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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”