Shares of major telecommunications companies, including AT&T, Frontier Communications, and Lumen Technologies, continued to plummet following a recent investigation by The Wall Street Journal. The investigation shed light on a concerning issue: U.S. phone companies have neglected a network of cables containing toxic lead.
This revelation sent AT&T’s stock tumbling by 6.8%, reaching its lowest level in three decades. Frontier shares also experienced a significant drop of 15% to $12.15, while Lumen’s stock fell by 5.4% to $1.75. Verizon Communications wasn’t spared either, with shares falling by 7.7% and heading towards their lowest close since 2010.
These losses come as an extension of declines in the telecommunications sector from the previous week. The combined market capitalization of AT&T, Verizon, Lumen, and Frontier has shrunk by a staggering $18 billion since the initial publication of the WSJ’s story. MoffettNathanson analysts Craig Moffett and Nick Del Deo anticipate further decline, stating, “We could see what amounts to a general telecom buyer’s strike for some time.”
In response to the investigation, both AT&T and USTelecom, an industry group, have launched webpages disputing the environmental and public health repercussions of the lead-covered cables. USTelecom stated, “We have not seen, nor have regulators identified, evidence that legacy lead-sheathed telecom cables are a leading cause of lead exposure or the cause of a public health issue. And safe work practices within the telecommunications industry have proven effective in reducing potential lead exposures to workers.”
This unsettling news has cast a dark shadow over the telecommunications industry, with investors questioning the integrity and responsibility of these companies. As the situation develops, it remains uncertain how long the impact of this crisis will linger.