Crexendo (CXDO) Q1 2025 Earnings Call May 06, 2025 04:30 PM ET Speaker0 note this conference is being recorded. I will now turn the conference over to your host, Jeff Corrin, Chairman of the Board. You may begin. Thank you, John, and good afternoon, everyone. Welcome to the Crexendo Q1 twenty twenty five year end conference call. I'm Jeff Corin, CEO and Chairman of the Board. On the call with me today are Doug Gaylor, our President and COO Ron Vincent, our CFO and in the room with us is John Britton, our CR ...

Investment Rating - The report maintains a positive outlook on the market with a base case index target for MXCN at 67 by the end of 2025, with a preference for sectors such as Energy, IT, and Utilities [36][38]. Core Insights - The report indicates a recovery in the MXCN index, driven by sectors like IT and Healthcare, with expectations of a market reversal by late January 2025 [9][11]. - The report highlights a cautious approach towards Consumer Discretionary and Staples, recommending a rotation into quality laggards and large caps over small and mid-caps [36][38]. - The anticipated GDP growth for China in 2025 is projected at 4.1%, slightly below the consensus of 4.2% [10]. Market & Sector Performance - MXCN sectors performance shows Consumer Discretionary up by 3.2% week-on-week, while Information Technology leads with an 8.3% increase [6]. - The MSCI China index has shown a year-to-date increase of 9.0%, with a notable recovery in sectors impacted by US tariffs [7][12]. Catalyst Calendar - The report outlines key upcoming macroeconomic indicators and sector-specific data releases, including PMIs and housing transactions, which could influence market movements [14]. Consensus Macro Forecasts - The consensus forecasts for China's GDP growth in 2025 are 5.1% for Q1, declining to 3.9% by Q4, indicating a gradual slowdown [16]. Index Targets - The MSCI-China index target for 2025 is set at 71, with a bull case of 80 and a bear case of 70, reflecting a potential upside of 13% from current levels [18]. - The CSI-300 index target for 2025 is projected at 3,787, with a bull case of 4,150, indicating a 10% upside potential [19]. Investment Recommendations - The report recommends overweight positions in Energy, IT, and Utilities, while advising underweight positions in Consumer Discretionary, Materials, and Staples [39]. - A barbell strategy is suggested, focusing on high-yielders and selected thematic plays in Internet and AI sectors [36][38]. Trading Statistics - Recent trading statistics indicate a net outflow of US$796 million from China equities, primarily driven by passive fund outflows, although there has been a positive development with resumed offshore ETF inflows [79][80].

Company Overview - Coherent Corp. (COHR) is set to report its third-quarter fiscal 2025 results on May 7, with revenue expectations of $1.4 billion, reflecting a year-over-year growth of 19.1% and earnings per share (EPS) estimated at 86 cents, indicating a 62.3% increase from the previous year [1] - The company has a strong earnings surprise history, having surpassed the Zacks Consensus Estimate in the last four quarters with an average surprise of 20.3% [2] Earnings Estimates - Current earnings estimates for Q1 and Q2 are 0.86 and 0.92 respectively, with full-year estimates of 3.47 and 4.28 [2] - There have been no recent changes in analyst estimates, with a slight downward revision of -0.29% for F1 and -0.70% for F2 [2] Market Performance - COHR shares have increased by 23.7% over the past year, outperforming its industry growth of 24.6% and the Zacks S&P 500 composite's 10% growth [6] - The stock is currently trading at a trailing 12-month price-to-earnings ratio of 2.67X, which is higher than the industry average of 1.76X and Alithya Group's 1.28X, but lower than AirJoule Technologies' 7.83X [9] Industry Insights - The telecom segment is expected to drive revenue growth, with a reported 11% year-over-year increase in Q2 fiscal 2025, attributed to strong demand for new products like 100G, 400G, and 800ZR/ZR+ coherent transceivers [5] - The rise in data traffic due to AI workloads is anticipated to boost investments in higher-capacity interconnects, benefiting Coherent's optical transport networks [10] Future Outlook - Management projects that 1.6T transceivers will be a key contributor to revenue in 2025, ensuring growth beyond the current 800G cycle [12] - The demand for high-speed optical transceivers is expected to increase as hyperscalers expand their AI training and inference workloads [11] Investment Considerations - Despite the positive outlook, potential revenue growth may be hindered by delayed AI infrastructure spending and geopolitical risks, particularly between the U.S. and China [13] - The company is viewed as fundamentally strong but carries a premium valuation, suggesting that investors may benefit from holding the stock while waiting for a more favorable entry point [15]

Core Insights - The communication services sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1][2] Company Summaries - **Fubotv Inc (FUBO)**: Reported a revenue of $405.96 million for the quarter, an 8.1% year-over-year increase, but missed the analyst consensus estimate of $415.45 million. The stock fell approximately 20% in the past five days, with a 52-week low of $1.10. The RSI value is 26.9, and shares closed at $2.42, down 17.4% [7] - **Cable One Inc (CABO)**: Announced disappointing first-quarter results, with a significant drop in residential data subscribers. The stock decreased around 43% over the past five days, reaching a 52-week low of $150.00. The RSI value is 12.2, and shares closed at $152.51, down 42.4% [7] - **Anterix Inc (ATEX)**: Launched the AnterixAccelerator initiative with an investment of up to $250 million. The stock fell about 9% over the past month, with a 52-week low of $27.37. The RSI value is 28.6, and shares closed at $29.84, down 0.4% [7]

Company Overview - RADCOM Ltd. is a leading provider of advanced, intelligent assurance solutions with integrated AI Operations (AIOps) capabilities [3] - The flagship platform, RADCOM ACE, utilizes AI-driven analytics and generative AI (GenAI) to enhance customer experiences [3] - RADCOM's advanced 5G portfolio offers end-to-end network observability, covering the radio access network (RAN) to the core [3] Product Features - RADCOM's solutions are designed to be open, vendor-neutral, and cloud-agnostic, promoting next-generation network automation, optimization, and efficiency [4] - By leveraging AI-powered intelligence, RADCOM reduces operational costs and enables predictive customer insights [4] - The platform integrates seamlessly with business support systems (BSS), operations support systems (OSS), and service management platforms, providing a complete, real-time view of mobile and fixed networks [4] Upcoming Events - RADCOM's CEO Benny Eppstein and CFO Hadar Rahav will participate in the 20th Annual Needham Technology, Media & Consumer Virtual Conference on May 8, 2025 [1] - Management will be available for virtual one-on-one meetings throughout the day [2]

Core Viewpoint - AT&T Inc. is set to report its first-quarter 2025 earnings on April 23, with revenue and earnings estimates at $30.43 billion and $0.52 per share respectively, indicating a stable outlook for the company despite slight adjustments in future earnings estimates [1][2]. Financial Performance - The Zacks Consensus Estimate for Q1 earnings is $0.52, unchanged over the past 60 days, while the estimate for 2026 has slightly decreased from $2.27 to $2.26 [2]. - AT&T has delivered an average earnings surprise of 4.06% over the last four quarters, with a notable surprise of 12.5% in the last reported quarter [2][3]. Business Developments - AT&T has signed a multiyear expansion deal with Nokia aimed at enhancing network services and operational efficiency [4]. - The company successfully tested 1.6 Tbps Data Transport across 296 kilometers of its fiber network, indicating a positive outlook for network capacity growth [5]. - New initiatives include the introduction of SplitPay for easier bill payments and the Connected Spaces Smart IoT Sensor Kit for small and medium businesses [6]. Customer-Centric Initiatives - AT&T has launched the AT&T Guarantee, offering bill credits for network outages, aiming to rebuild customer trust after previous service issues [7]. - Collaboration with TransUnion is underway to enhance customer experiences through branded calling services [7]. Segment Performance - The Communications segment is projected to generate revenues of $29.33 billion, while the Business Wireline division is expected to see a revenue decline of 6.1% year-over-year, estimated at $4.6 billion [8][9]. Market Position - Over the past year, AT&T's stock has increased by 63.6%, outperforming the industry average growth of 44.2% [10]. - The company's price/earnings ratio stands at 12.46, lower than the industry average of 14.13 but above its historical mean of 8.16 [11]. Strategic Outlook - AT&T plans to continue investing in key areas to drive long-term growth while maintaining a healthy dividend [13]. - The company is experiencing positive momentum in its postpaid wireless business, characterized by lower churn rates and increased adoption of higher-tier plans [13]. Challenges - High debt obligations pose a risk to AT&T's growth initiatives and make it vulnerable to economic downturns [14]. - Intense competition from T-Mobile and Verizon, along with rising data traffic and spectrum constraints, are significant challenges for the company [14].

AT&T (T 0.30%) shareholders have plenty to celebrate, with the stock up 24% thus far in 2025. The telecommunications giant has presented robust earnings, reinforcing an optimistic long-term outlook. The stock's impressive performance is an outlier next to the 3% decline in the S&P 500 index year to date. As such, AT&T has emerged as a reliable source of stability amid the broader stock market volatility that's causing concern about the strength of the U.S. economy. Can AT&T's record-setting rally continue, ...

Investors are shifting their strategies due to rising market uncertainty caused by ongoing tariff disputes and widespread economic concerns. They are seeking safety in historically defensive sectors, and as a result, the telecommunications sector is experiencing a resurgence of interest. The double-digit growth of telecom giants Verizon NYSE: VZ and AT&T NYSE: T over the past three months highlights the renewed attention on these companies. These established telecom titans may be emerging as crucial defensi ...

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the **High Yield (HY) Telecom, Cable, and Media** sectors, highlighting the competitive landscape and investment needs that are affecting credit outlooks across these industries [11][67]. Core Insights and Arguments 1. **Cautious Outlook for HY Telecom and Cable**: The overall outlook for HY telecom and cable remains cautious due to intense competition and significant investment needs, which are expected to keep leverage elevated [11][67]. 2. **Media Sector Pressures**: The HY media sector faces secular pressures such as cord-cutting and macroeconomic uncertainties that may adversely impact advertising revenues this year [11][12]. 3. **Credit Spread Risks**: Risks to credit spreads are skewed to the downside, prompting recommendations for more defensive sector trades while identifying attractive relative-value buying opportunities [12][67]. 4. **CHTR HY/IG Differential**: Expectations for the CHTR HY/IG differential to decompress in 2025, with a recommendation to sell certain CHTR bonds while buying others to capitalize on this shift [14][17]. 5. **Debt Issuance and Leverage**: CHTR is projected to issue approximately $1.1 billion in net debt this year, with year-end 2025 pro forma net leverage expected to be around 4.25x [17]. 6. **Potential M&A Activity**: The call suggests that ATUS/CSCHLD might benefit from potential M&A activity, with recommendations to buy lower-dollar guaranteed notes [18][21]. 7. **SATS Opportunities**: SATS is highlighted for refinancing prospects and spectrum valuation, with specific trade recommendations for secured and unsecured notes [22][27]. 8. **LUMN's Mass Markets Segment**: A potential sale of LUMN's Mass Markets segment is seen as a catalyst for the company, with a valuation of approximately $6.6 billion [31][30]. 9. **SBGI vs. GTN Leverage**: SBGI's net leverage is expected to increase more significantly than GTN's in 2025, with specific trade recommendations to sell SBGI and buy GTN bonds [37][41]. 10. **CCO's High Leverage Risks**: CCO's high leverage presents downside risks, with expectations for spreads to widen due to macroeconomic uncertainties and investor fatigue [46][42]. Additional Important Insights - **Consolidation Trends**: The call notes that consolidation and M&A could increase as telecom and cable players seek to remain competitive and profitable [21]. - **Market Pricing Dynamics**: The market is currently pricing in hypothetical scenarios for various companies, indicating a complex landscape for credit assessments [72][70]. - **Strategic Uncertainties in Media**: The media sector is facing strategic uncertainties while waiting for direct-to-consumer (DTC) gains to outpace pressures from traditional linear models [73][74]. This summary encapsulates the key points discussed in the conference call, providing insights into the current state and future outlook of the HY Telecom, Cable, and Media sectors.

I only buy strong businesses. I only buy them when they're cheap. Backgrounds in economics, philosophy, government, data. I started my investing journey with a fairly concentrated portfolio of Canadian dividend payers in the telecom, pipeline and banking industries. I have moved forward through different industries including payments, US regional banking, Chinese and Brazilian equities, REITs, technology companies and a few other emerging market opportunities, as well as microcap through to megacap range. I ...