Public Markets

The FOCUS Enterprise-Focused Telecom Technology Index (EFTTI) delivered a strong return of 12.6% over these past three months. This outperformed both the S&P 500 and the NASDAQ, each of which gained only 5.1%. For the past 12-months, the sector delivered very similar returns to the broader indices. The 34.8% year-over-year return in the EFTTI is slightly above the 34.5% gain in the S&P 500, but slightly lower than the 37.4% return of the NASDAQ. Sector multiples are up considerably compared to this same time last year. The sector revenue multiple increased from 5.3x to 7.0x, while the sector EBITDA multiple increased from 20.7x to 27.4x.

Public Markets

The FOCUS Communications Service Provider Index (CSPI) was barely in the black for this current period with a three-month gain of 1.0%.This lagged both the 8.2% gain in the S&P 500 and the 9.5% gain in the NASDAQ over the same time frame by a wide margin.The situation is similar for the full year period as the CSPI’s increase of 16.5% represents less than half of the annual gains of the S&P 500 (up 38.6%) and the NASDAQ (up 44.2%). Sector multiples are higher than at this same time last year and closed out the period at 3.1x revenue and 8.7x EBITDA. Year-ago multiples were only 2.7x revenue and 7.8x EBITDA.

Public Markets

Once again, the FOCUS Telecom Business Services Index (TBSI) climbed higher, gaining 3.5% over the past three months. This marks the fifth straight period with a positive return for the sector. However, the TBSI did lag the broader indices as the S&P 500 was up 8.2% and the NASDAQ was up 9.5% over the same time period. When looked at over the past 12 months, the sector’s return compares more favorably to the overall market. The 43.3% year-over-year gain in the TBSI outperforms the 38.6% gain in the S&P 500 and falls just shy of the 44.2% gain in the NASDAQ. Sector multiples are also higher than at this same time last year and closed out the period at 0.7x revenue and 9.6x EBITDA. This compares to year-ago multiples of 0.6x revenue and 7.4x EBITDA.

Public Markets

The FOCUS Carrier-Focused Telecom Technology Index (CFTTI) enjoyed yet another strong reporting period with a three-month gain of 13.1%. Not only was this gain impressive in absolute terms, but it handily outperformed both the 10.3% gain in the S&P 500 and the 4.2% gain in the NASDAQ over the same time period.The CFTTI still lags the broader indices for the full year period as its 18.6% gain in the last 12-months compares unfavorably to both the 38.1% gain in the S&P 500 and the 44.9% gain in the NASDAQ. Sector multiples ended the period at 2.6x revenue and 12.8x EBITDA. Both of these are higher than year-ago multiples of 2.4x revenue and 11.7x EBITDA.