Another Solid Quarter for Uniti, but the Stable Windstream Business Overshadows Other Growth

Uniti continues to execute well and again had good results across the board in the first quarter. Business remains strong, and the firm is managing inflationary and supply chain pressures. For Uniti, the problem remains that its business is dominated by its Windstream lease, and any reasonable amount of success in the rest of its business doesn’t have a major impact on total results. Unless the firm makes a large deal or successfully sells itself—as management continues to promote how the market is undervaluing it relative to other acquisitions—we don’t expect significant events that will propel the stock higher from here. We’re maintaining our $12 fair value estimate and believe the firm is fairly valued.