Lumen Technologies Inc (LUMN)

[eastunder]

CenturyLink Shares Swoon On 26% Dividend Cut

http://www.forbes.com/sites/ericsavitz/2013/02/13/centurylink-shares-swoon-on-26-dividend-cut/?partner=yahootix

CenturyLink shares are taking a pounding after the company announced a 26% reduction in its quarterly dividend.

The telecom company plans to reduce the rate to 54 cents quarterly, from 72.5 cents. At the old rate, the company had a dividend yield of 7%; at the revised rate, the yield based on today’s regular session close falls to 5,2%.

The company also said its board has adopted a $2 billion stock repurchase program.

CenturyLink also said it plans to use a portion of free cash flow generated in 2013 and 2014 to repay debt.

“We are confident that the capital allocation initiatives we announced today will allow us to continue our investments to drive strategic revenue growth, while maintaining our focus on creating long-term shareholder value,” CEO Glen Post III said in a statement.

Meanwhile, the company posted Q4 results that were about in line with estimates.

For the period, the CenturyLink reported Q4 revenue of $4.58 billion, down from $4.65 billion a year ago, and just a hair below the Street at $4.59 billion. Adjusted EPS was 67 cents a share, a penny light of the Street at 68 cents.

For Q1, the company sees revenue of $4.46 billion to $4.51 billion, with adjusted profits of 67-72 cents a share. Street consensus had been $4.55 billion and 66 cents.

For the full year, CenturyLink is projecting revenue of $18.1 billion to $18.3 billion, with adjusted profits of $2.50 to $2.70 a share. Previous consensus was $18.22 billion and $2.64 a share.

CTL in late trading is down $5.65, or 13.6%, to $36.04.