Dave Schaeffer, CEO of Cogent Communications Group, Inc. (CCOI) says the there are two major trends occurring simultaneously in terms of data usage. The first is the “product substitution” of Internet over every other telecommunication service and product.
“Everything is moving to the Internet. Voice is going over the top in VoIP, video is going over the top, and people are turning off linear video channels to replace them with on-demand using the Internet,” Schaeffer says. “That is driving unit volume growth, but because of technological advancement, price per bit continues to fall.”
FOR MORE INFORMATION ON THIS INTERVIEW CLICK HERE.
The other key trend, Schaeffer says, is that Internet is becoming the primary mechanism to deliver video. Schaeffer believes both trends are positive for Cogent in part because the company doesn’t have a legacy business that is being eroded.
“Anything that causes growth in the Internet is a positive for us. In fact, our corporate business has grown organically sequentially for 36 consecutive quarters as a public company at an average growth rate of 3.3%. Our service-provider business has grown at an average of 2.7% sequentially quarter over quarter.”
Additionally, Schaeffer says Cogent has a cost structure that enables the company to sell at low prices while generating high cash flow.
“We have been fortunate in that we have been producing free cash from operations for eight years,” he says. “We pay a dividend, and we have grown that dividend every quarter sequentially since issuing it.”
Michael Waring, Sees Both Growth and Dividends Paying Off for Nicaragua Geothermal Stock Pick
March 29, 2018
Blockchain Technology Stocks DigitalX Ltd. (ASX:DCC) and BTL Group Ltd. (CVE:BTL): Why Not Buy Both?
April 19, 2018
ARM Holdings plc (ADR) (ARMH) Dominates Handset and Tablet Space with I.P. Used by Both Apple and Samsung
October 15, 2013
Skyworks Solutions Inc (SWKS) Benefits from Supplying to Both Apple and Samsung Handsets
October 03, 2013
Alliant Techsystems’ (ATK) Ammunition Demand to Decline in Both Commercial and Defense End Markets
May 31, 2013
