Profit ratio

3 Best Telecom Stocks to Buy in July

Telecommunications companies have transformed the way we communicate, work and live in a world full of technology. During the pandemic and global and local shutdowns, we have all used telephone, internet and television services to communicate, work and play while staying at home.

Telecom companies often make a lot of capital expenditures to compete and trade at attractive valuations. The three telecommunications stocks in this article have very attractive valuations, solid fundamentals and good growth. Moreover, they are at price levels that make their rebound likely.

Here are the three best telecom stocks to buy in July:

Teleprinter Company Price
PLATE Dish Network Corporation $17.56
LUMN Lumen Technologies, Inc. $10.85
FYBR Frontier Communications Parent, Inc. $25.04

Best Telecom Stocks: DISH Network Corporation (PLATE)

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DISH Network Corporation (NASDAQ:PLATE) provides pay television services in two main segments: pay television and wireless. The stock shows losses of almost 44% in 2022, which currently represents a prime investment opportunity.

DISH Network Corporation is both a mature and growing company, combining the best of both worlds. He has two consecutive years of growing sales, and he knows how to turn those sales into what matters: nice, consistent growing profits. In 2021, net income grew 36.76% to $2.41 billion and even though the first quarter of 2022 showed a decline in sales and net income quarter over quarter, the company has a strong track record of positive free cash flow.

In terms of valuation, the shares are trading at a forward price-to-book (P/B) ratio of 0.56X. Interestingly, its futures price to sales (PS) ratio is also 0.56X.

The price/earnings ratio (P/E) of 5.18 is very low, but the upside potential is very high since the one-year target is $41.29, which would represent a nice gain of 128%.

LumenTechnologies (LUMN)

A magnifying glass zooms in on the Lumen Technologies (LUMN) site.

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Lumen Technologies (NYSE:LUMN) powers the fourth industrial revolution with products for communications, such as call services, edge computing, networking, security, hybrid computing and cloud connectivity.

In the first quarter of 2022, financial results were mixed with a beat in earnings per share (EPS) and a loss of revenue. The company said GAAP EPS of 63 cents, a beat of 18 cents and revenue of $4.68 billion, a shortfall of $5.54 million. The company has exceeded EPS estimates for the past three out of four quarters, which is very bullish.

The stock trades at a P/E ratio of 5.3 and has a very good forward dividend yield of 9.03%.

The valuation of the LUMN share is now very attractive as it trades at a forward P/S ratio of 0.64X and a forward P/B ratio of 0.87X.

Best Telecom Stocks: Frontier Communications Parent (FYBR)

a photo of cell towers during the day

Source: Shutterstock

Frontier Communications Parent (NASDAQ:FYBR) provides high-speed Internet, telephone and video services over fiber optics. The company aims to improve your Internet experience.

FYBR stock is down about 16% year-to-date. The first quarter 2022 earnings report was mixed, but mostly positive. The GAAP EPS of 26 cents was a beat of 3 cents and revenue of $1.45 billion was a marginal shortfall of minus $5.27 million.

In 2021, the company recorded a massive net profit growth of 1332.59% to 4.96 billion. Free cash flow generation is strong and positive. Moreover, the the valuation is very attractive now.

The P/S a ratio of 0.92X signals a cheap stock. The company has very strong profitability metrics, with a gross profit margin of 62.88% and a net profit margin of 80.23%.

PE report 1.16 is very low and the one-year target is $40, which represents 66% upside potential.

As of the date of publication, Stavros Georgiadis, CFA had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

Stavros Georgiadis is a CFA charter holder, equity research analyst and economist. He focuses on US stocks and has his own stock market blog. laborsesoninternet.com. He has written various articles for other publications in the past and can be contacted at Twitter and on LinkedIn.