Broadwing (BWNG)

[Learning2vest]

Been fun to watch the market "discover" the underlying fundamentals here. BWNG was not on the market's radar until the company reported it's first break even EBITDA last qtr. They had been making steady progress toward doing that for 8 straight qtrs, but it was not until it happened that the market took notice.

I'm thinking that top line revenues will be the key to what happens when the 1st qtr results get reported in a few weeks. The last big debt payment was made on Feb 21, 2006, so that will be a drag on cash flow one last time. The accelerated depreciation of Focal assets will also continue to be a drag on net profit, but that non-cash charge is about to end as well.

Getting mighty close to the time when BWNG's incremental revenues will yield proportional incremental profits. That's when the real fun will begin here! Nothing drives market valuations better than a strong growth trend in net profits.