DA Davidson Lowers Target to $4 on Frontier Communications

DA Davidson remains Neutral rated on Frontier Communications (NASDAQ:

) and reduces its price target to $4 from $6, on the expectation of a dividend reduction from the company. DA Davidson comments, "We think the board will reduce the dividend to $0.50 to conserve cash and speed up deleveraging. We are cutting our price target to $4 from $6, which equates to 5.3x our 2012 EV/EBITDA estimate. We could become more positive on the stock once management completes the transition off of Verizon's systems and if they can reinvigorate DSL subscriber growth." FTR closed at $4.32 a share on Friday.