CiG’s Stock Goes Down Even With Towers Up

January 7, 2015

By J. Sharpe Smith —

Jan. 8, 2015 — While the stock prices of the big three tower companies have soared, CiG Wireless, a tower company that went public in 2012, has watched its stock spiral down from $2.10 to 25 cents a share in the last year. It has gone down even further since Sept. 30, 2012, when the share price peaked at $5.

Why? This company’s stock declined in value during a period while carrier capex is counted in the billions of dollars. Additionally, CiG Wireless has grown aggressively in the last two years and its revenue has followed suit.

CiG Wireless acquired 108 towers from 2013 to 2014, more than doubling its portfolio. It bought 38 towers from Liberty Towers in August 2013, 49 towers from Southern Tower Antenna Rental, 19 towers from PTA-FLA, Inc. and two towers from Fidelity Towers.

CiG Wireless reported $1.8 million in tower revenue for the three months ending September 30, 2014, which was an increase of $0.8 million or 87 percent compared with the same period of the prior year. The increase was primarily attributable to revenue generated from the acquisitions completed during 2013 and 2014.

The company’s loss from operations for the third quarter was flat at $2.1 million year over year. For the second quarter, it reported a loss of $2.5 million, compared with $1.5 million year over year. The loss for the first quarter was $2 million, which was flat compared with the same period for the prior year

The reason CiG Wireless’ stock price of 25 cents, which represents a 92 percent drop from its initial public offering at $3.30, may be found in its financial details. The tower company’s total long-term debt has grown from $19.7 million to $33.2 million in the past year. Additionally, total stockholders’ deficit grew from $6.5 million $20.1 million in the last year.

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J. Sharpe Smith is the editor of AGL Link and Small Cell Link newsletters.