Lumen fiber operations could be valued at over $5.5B, says Raymond James

AT&T (T) is in talks to buy Lumen’s (LUMN) consumer fiber operations in a deal that would value the fiber at over $5.5B, Bloomberg and Reuters reported on Tuesday afternoon, Raymond James analyst Frank Louthan tells investors in a research note. The firm says Lumen’s stock reacted negatively to the news because Reuters had reported in December the deal could be worth $6B-$9B, making Tuesday’s article seem like a low valuation. The firm would view anything over a 10x multiple for the asset as a “very good” price, and sees the asset trading in the next 12 months, with AT&T as one of the top bidders. Other potential bidders could be T-Mobile (TMUS), Verizon (VZ), and Bell Canada (BCE), Raymond James adds. Raymond James has a Market Perform rating on Lumen shares.