Frontier Communications: Buy It For The Yield

The above is often attributed to P.T. Barnum, a master showman perhaps best known as Barnum in Ringling Bros. & Barnum and Bailey Circus. Barnum also owned one of the most popular museums of its time, the American Museum in New York City, which often drew large crowds - crowds of people who didn't want to leave. Large crowds were fine, but if customers didn't leave, Barnum was limited in the number of tickets he could sell in a day. To address the issue, he posted signs in the museum boldly stating "To the Egress". Those unfamiliar with the word thought they were headed to another exciting exhibit, realizing too late that they had exited the building.

In the investing world, I doubt investors in Frontier Communications (NASDAQ:FTR), or the company's management or customers have the same view as Barnum. Frontier has been getting a good deal of bad publicity following the completion of a $10.5 billion acquisition of certain Verizon Communications (NYSE:VZ) assets. That publicity covers Internet outages, billing errors and poor customer service. And, for Frontier investors, the question might be whether or not they should head "To the Egress".

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