Lumen – Earlybirds Invest

Beaten-down telecom stock Lumen Technologies (LUMN 12.37%) wasn’t looking so battered on Wednesday. In fact, the shares jumped more than 12% higher in price on news that a sports media company would be harnessing its technology to broadcast live games. Lumen’s leap was far more pronounced than the S&P 500 index’s 0.2% increase on that Hump Day trading session.

Scoring a touchdown with a college sports broadcaster

Wednesday morning, Lumen announced that it and Pac-12 Enterprises, the broadcasting unit of the Pac-12 college football conference, are teaming up this season. The broadcaster will use Lumen’s network-as-a-service (NaaS) technology to deliver the conference’s games to viewers of the highly competitive league.

Football player on the field at night clutching a ball.

Image source: Getty Images.

Lumen said this is to begin as soon as this Saturday, with the Washington State versus Idaho contest.

The company did not supply any financial particulars of its new arrangement with Pac-12 Enterprises, nor did it speculate how it might affect fundamentals like revenue. Regardless, Lumen’s success in roping in a high-profile corporate customer with demanding connectivity needs is a clear win for the company and quite the encouraging morale booster.

Assuming the tie-up is mutually beneficial, we can expect it to generate new business for Lumen for clients with similar data transmission requirements.

Lumen goes live

At the very least, we can expect media companiess that broadcast content like live athletics to consider partnering with Lumen.

In the press release touting the Pac-12 Enterprises deal, Lumen quoted its CTO Dave Ward as saying that its client “can instantly dial up bandwidth — delivering the speed, reliability, and control that modern productions demand.“

Ready for the worst

Lumen laid out those plans in a press release it published Monday morning. Across its rather sprawling enterprise network, the company said it is utilizing cutting-edge technologies like artificial intelligence (AI) and geospatial monitoring to keep customers connected in emergency situations.

Happy person using headphones and a phone while lying on a couch.

Image source: Getty Images.

Disaster preparedness is a topic of particular concern these days, as the U.S. has been beset by a higher-than-usual set of disasters lately. In 2024, according to the National Centers for Environmental Information (NCEI), this country suffered 27 weather or climate disasters, which is exactly three times the annual average from 1980 to 2024. Each loss due to these topped $1 billion.

Lumen added that its preparedness efforts are augmented by partnerships with state and federal authorities, including the Federal Emergency Management Agency (FEMA).

Price target raised by analyst

Lumen stock also got a boost in the middle of the week when an analyst raised his price target on it. BNP Paribas’s Sam McHugh upped his fair value assessment to $4 per share from the previous $3.51, although he left his neutral recommendation intact.

In his analysis, according to reports, McHugh said that the company is facing more “disconnects” from customers, but the pending $5.75 billion sale of its fiber business to giant peer AT&T will allow it to pay down some of its considerable indebtedness.

Lumen is a legacy landline telecom operation and has struggled for years to succeed in a world dominated by mobile. Eroding revenue and frequent bottom-line losses indicate this might not have been the best path to pursue. Personally, this stock isn’t a buy for me.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.