In a report released today, Gregory Williams from TD Cowen maintained a Buy rating on Cogent Comms, with a price target of $62.00.
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Gregory Williams has given his Buy rating due to a combination of factors that highlight Cogent Communications’ potential for growth and revenue generation. One of the primary reasons is the significant progress in their Waves business, which has shown strong performance with substantial wins from major clients like AWS and potentially Google. This indicates a positive shift in their business trajectory after a slow start, suggesting a promising future for the company’s financials.
Moreover, the demand for larger circuits, particularly 400 gig waves, is expected to grow as hyperscalers seek to optimize AI training processes. Cogent’s capability to provide these larger circuits efficiently positions them well in the market. Despite concerns about a potential dividend cut, the anticipated growth in the Waves business could offset these risks, making the stock an attractive buy for investors looking for long-term gains.