Towerstream Corporation (NASDAQ: TWER)
Towerstream Corporation has been an incredibly interesting stock to follow as of late, and for good reason. The company recently released a company update that excited investors. However, shortly after the update, we started to see more declines. Nonetheless, we’re seeing big gains today, and it seems as though investors have renewed faith in the company. Today, we’ll talk about the update that was released a couple of weeks ago, what we’re seeing in the market today, and what we can expect to see from TWER moving forward. So, let’s get right to it…
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The Update That Caused The Excitement Around TWER
For quite a while now, investors have been concerned about Towerstream’s business and ability to sell their product. Nonetheless, on June 14th, the company released an update that shows that they are headed in the right direction. Here’s what they had to say…
The update was a multi-part update that offered quite a bit of good news. In the update, we found out that 52% of On-Net contracts in the months of April and May were secondary customer contracts. This means that TWER had already installed its systems on the buildings, making these the most profitable contracts the company offers. This helped to boost revenue per On-Net contract by 35% from April to May.
Another key piece of data surrounded the sales-to-installation cycle. On active On-Net buildings, the cycle from sales to installation shortened significantly. In the past, the process would take months. Now, the process takes weeks.
Finally, the company is looking to add new properties to its already-installed buildings list. With the update, we learned that TWER reached an agreement with a large commercial property owner in New York City. The new agreement surrounds providing On-Net high speed internet services to the property’s tenants. Following the overwhelmingly positive news, Towerstream Founder and CEO, Philip Urso, had the following to say:
“On-Net is a win for the company and the customer… For Towerstream, it is capital efficient, focuses our sales staff and dramatically lowers customer churn. The customer gets fiber-quality in terms of speed and reliability, priced at about 40% below market rates.”
What We’re Seeing In The Market Today
While recent movement in the market surrounding TWER hasn’t been great, it seems as though investors have renewed faith in the company. This is shown in the incredible gains we’re seeing in the stock today. Currently (12:17), the stock is trading at $0.17 per share after a gain of $0.02 per share, or 15.65%, thus far today.
What We Can Expect To See moving Forward
Moving forward, I have a relatively bullish opinion of what we can expect to see from TWER. The reality is that, while it may have an uphill road to follow, the company is making the right moves. With a clear focus on adding new properties to its list of installed systems, the company is laying the foundation for strong profits in the future. The recent update shows that Towerstream has done a great job expanding profits and selling its services to building tenants. With a strong product that offers a great solution at nearly half the normal cost, demand is likely to climb as new installations are completed. All in all, I’m expecting to see gains in the long run.
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What Do You Think?
Where do you think TWER is headed moving forward? Join the discussion at TalkTRENDZ from CNA Finance!
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