Uniti Group Inc. (UNIT) Earnings Call Transcript & Summary

Hi. Good afternoon, everyone. This is Jeff Harlib from Barclays Credit Research. We're pleased to host Uniti Group for fireside chat. I apologize, I've had a video issue here, but we will go ahead. I'm pleased to introduce Ron Mudry, Chief Revenue Officer; and Bill DiTullio, Vice President of Finance and Investor Relations. Welcome, gentlemen, and thanks for being at the conference.

Thank you.

Thanks, Jeff.

So maybe we can lead off, there are several positive fundamental trends, which should benefit your business. They include 5G network build-outs by U.S. carriers, fiber-to-the-home build-outs, RDOF and additional government initiatives to bring broadband to rural America and an overall surge in broadband traffic generally. So which of these trends you think should most benefit Uniti? And should we expect a further acceleration in performance trends?

Hi, Jeff. This is Ron. I can take that question. So you're right, all those trends are having a positive impact on our business. I'll just try to cover a few of them and give a couple of examples of what we're seeing and what we expect. So obviously, 5G is a huge driver for us as the private carriers are densifying their networks. We're seeing strong activity of all the wireless carriers. Recall in our first quarter, we announced that our dark fiber and small cell revenue was up 30% over the prior year. I think that's an example of bringing a lot of projects online and continued strength in that sector. We are also now beginning to see some interest in higher bandwidth for backhaul to towers because of the new C-band auction. The recent C-band auctions that took place, and the carriers would be putting on this new spectrum pretty soon. Some of the spectrum will clear in the next year or so, and others will take a little longer period of time. But we're already seeing multiple carriers, wireless carriers requesting us to upgrade the bandwidth at lit sites from -- generally between 300 meg and 1 gig up to 10 gig. It's the first time we've seen broad demand for 10-gig at macro towers. You're also seeing more dark fiber demand as a result of that. The C-band itself can generate quite a bit of bandwidth through the wider channels that it has. But the fact that they're putting the C-band spectrum on towers that they're running other spectrum on as well is really causing a cumulative effect of that bandwidth performance. So clearly 5G and wireless segment is going to continue to be a strong driver as it has been for Uniti for years. We'll talk about DISH I'm sure later. As you know, we're 1 of DISH's initial 4 preferred partners on the fiber side, and that's going to be -- fuel a lot of growth as well. On the government programs, clearly, those are all positive for us as well. We don't necessarily participate in them directly. For example, RDOF, we're not interested in serving the residential customers directly. But those are great programs because it allows us to work with the winners, the groups -- the support and help them with the middle mile and backlog and lease up our fiber as well as providing connections back to Internet hubs and major exchanges. Clearly, fiber-to-home is a big growth segment everywhere. Our GCI program with Windstream is a part of that. But we're also seeing a lot of growth in other operators building out fiber-to-the-home, and really looking for us for backbone, middle mile support for those networks. And that's because a lot of that activity is in Tier 2, Tier 3 markets where we -- which is our sweet spot basically. The only other thing I'll comment on is just general work from home, increased focus on the cloud and just higher demand for broadband generally is really driving our enterprise business. Our lease-up on the enterprise side has been going very strong. Our revenues were up 17% on the revenues -- on the enterprise side in the first quarter versus prior year, and our bookings continue to be strong. And that is high margin, low CapEx business because we're leasing up those networks that we built a few years ago to handle customer transactions for the wireless carriers. So overall, I see all those trends really providing a positive tailwind for us and giving us a lot of opportunity in the next few years.

Okay. And are there some headwinds against that, that you see from churn and some other headwinds that might offset some of that?

I mean I think our headwinds are normal headwinds. We feel there's more tailwinds than headwinds. You always have some element of churn. Our churn is very low relative to the industry, as you know. I view that the opportunities will outpace that and that we should see strong growth. Bill...

Yes, Jeff, I'll just comment quickly. I mean we -- today, again, on the dark fiber, you -- even these wireless deals that we're doing, they're very long term, most of these contracts 10, 20 years. We aren't seeing really any churn on that side of the business. The only churn we're really seeing are on our enterprise. Obviously, there's some churn there in Uniti Fiber. And there are some rerate churn, when customers do rerate some of lit contracts, there's some churn associated with that. And then also are customers that are converting lit sites to dark fiber. Again, there is usually a step down there. But when you take into account, you're going from a 5-year contract on average to a 10-, 20-year contract on average, the total contract volume more than offsets that churn. So again, Ron said, company-wide, we have a very low monthly churn rate of about 0.3%, 0.2%. And even within Uniti Fiber, it's very manageable within the industry norms.

Okay. Great. Drilling down a little more on the lease-up strategy. You had a slide, you have a very strong pipeline across customer segments, domestic, international carriers, regional carriers, government is a big one. Where do you think -- where are you seeing most of the interest? And when do you see -- I realize these opportunities take time to come to fruition. But over what time frame should we see the revenues from these -- this pipeline?

Sure. So if I had to kind of summarize our lease-up strategy, it's to focus on on-net, near-net opportunities, capital efficiency and high margin. And if I look at that, at the leasing segment and the Uniti Fiber segment, there are a few different -- few solid differences there, but both have good opportunities. On the leasing side, we're looking at dark fiber on a national basis. We've consolidated our wholesale teams, again, our sales support teams into 1 group, so that we can focus closer on the large strategic accounts. I think that the new fiber that we obtained in the Wind settlement -- the Windstream settlement, it was providing a lot of interest because that hasn't necessarily been in the market as much, and we're able to combine that fiber with other fibers that we own, such as the Lumen fiber we got a few years ago when they were forced to divest that, TPx and others as well as Uniti Fiber built fiber -- solutions that are differentiated and unique to what's been out there. So that's been driving a lot of demand. And most of that demand comes from content companies, international carriers seem to be in a phase of upgrading their North American backbones or transitioning from lit backbone to dark fiber. And because the Windstream settlement fiber is very regional and Tier 2, Tier 3 oriented, that's where we're seeing a lot of demand from regional carriers helping to fill in their networks, expand or support their growth through leasing backbone from us rather than overbuilding -- or rather than greenfield build. In the Uniti Fiber area, these are core Southeast markets, where we look for operator of the fiber. Our lease-up strategy there is to really focus on follow-on business to grow the margins that we have in place from those anchor builds that we did for the wireless carriers. If you recall, we had a lot of transactions going on at the same time when we acquired the various companies a few years ago. Those projects pretty much are all wrapped up now and we shifted to the lease-up phase. And the enterprise business is a big part of that. Of course, we want to put more wireless carriers on those towers, too. And we're seeing that with the DISH deal we'll talk about. But the enterprise space has really been growing fast. And those margins are 70% to 90% on an incremental basis. They're very capital efficient. We target customers less than 1,000 feet from our fiber. That seems to be our sweet spot. And that's allowed us to grow our yields on those anchor builds that we did from 7% to 14%, basically doubled it in a couple of years. And I think you'll continue to see that take steam. And all of those initiatives are driving revenue right now, but I think you'll see them accelerate more over the next year or 2 years and so forth and hopefully they just continue on thereafter.

Okay. And I think you said you had $17 million of lease-up annual revenue over the last 5 quarters. Do you see that amount, is it growing? Or is it sort of a good run rate? Or is it sort of hard to say?

Bill, I'll refer to you on that?

Yes. So Jeff, what you're referring to there is that Uniti Fiber, which we said over the last 5 quarters, the lease-up we've generated is $17 million of annualized -- represents $17 million of annualized revenue. And those opportunities were coming on at incremental yields of 50%-plus. And so we're talking about before we're getting that anchor yield 7% and the lease-up we've done today has driven that anchor yield to a cumulative yield of 14%. So doubled it in the last 4 years. But really, we're still are in the early stages of leasing up these networks. Again, most of these networks that we had built out, we're not finished until the end of 2020, these dark fiber small cell networks. And so we completed all of them -- most of them, the legacy ones anyways, and we do have a couple of projects that are still underway, and we'll continue to pursue greenfield builds going forward, right? So we're going to be active on that front. We're just going to set the cadence better and do a handful at a time. And that's why we talked about our capital intensity Uniti Fiber should be coming down over time to that mid-30% range because it's a mix of focus on the lease-up, which requires substantially less CapEx than maker builds themselves, but also it's a function of pursuing a handful of these greenfield builds. But to answer your question about is this a good run rate going forward? I would just say we're still in the early stages. We're going to continue to execute on lease-up. That lease-up is going to be mostly coming from nonwireless opportunities. So it's going to be selling to enterprises within our Southeast market, schools, government, healthcare, those types of customers. You look at the mix of bookings over the last several quarters, predominantly, they've been coming from those buckets, and we continue to expect that trend to continue. But at the same time, with DISH coming on that opportunity and then other wireless carriers where we could add on a second or third tenant as some of these macro sites or small cell sites, those are all high-margin lease-up opportunities as well. So I think it's tough to tell exactly what the run rate will be because we're still are in that early stages of lease-up.

Got it. Okay. And I think you had said your lit backhaul dark fiber and small cell sites was 1,100, which seems like a pretty high number. How does that compare to what it was previously? And I think you said you expect to triple the number of fiber route miles built over the next 3 years versus the prior 3 years? Can you just discuss that? And what kind of CapEx that might require?

Yes. So the first part of your question about the backlog, you're correct. We have about 1,100 wireless sites in our backlog today. And when you compare that to a year ago, it's actually down a little bit. I think we had about 1,700 sites in our backlog at that point. But again, you have to remember, a year ago, we were still in the midst of building out these anchor builds. So some of those sites, those wireless sites in those -- in the backlogs were part of the large anchor builds. So even though we've completed those anchor builds, we still have 1,100 sites in our backlog. So it is a very healthy backlog mix. And so again, a lot of -- some of that is greenfield. Some of those are greenfield projects that we're on, but a lot of it also is, especially small cell stuff and dark fiber is add-on as well as lease up. So it's a good mix of there. And your comment about tripling what we said on our last earnings call is we could triple the amount of fiber we build -- we've built historically over the past year or for years. And really that -- most of that's going to be related to the GCI program. So for those of you who are familiar, as part of our settlement with Windstream, we have -- there's fiber that will be built and Windstream will make that investment. And as long as it qualifies under the GCI program, so it's for fiber and fiber-related assets that need certain minimum threshold returns and other criteria, we'll reimburse Windstream for that investment. And so that becomes our asset at that time. And then it gets added to the lease 1 year later at an 8% initial yield, so 0.5% annual escalator. So when we talk about adding -- building adding, tripling the number of route miles being constructed to our portfolio, really a lot of that's going to come from the GCI program. That's going to be the main driver. But again, there also will be fiber that we're building at Uniti Fiber in support of dark fiber and small cell projects and other wireless projects.

Got it. Okay. Well, that makes sense then. Okay. And just a reminder, people can send in questions, and we'll try to get to them. So just -- since you mentioned the Windstream GCI program, what can you say the projects to date that you've approved under that program? I assume they met your hurdles. Just any additional color on that?

Yes. So to date we've invested approximately $127 million into that program. And for full year 2021 per the outlook we gave on our last earnings call, for the full year 2021, we expect to invest approximately $200 million. So to date, we've added over 3,000 route miles, going to have a significant amount of route miles again this year. And again, that will get all added at an 8% initial yield 1 year after. So for the investments we've made to date, they'll generate about $10 million of annualized revenue when fully complete. And so the way the program works is we've committed up to $1.75 billion over 10 years. And so on average, $175 million per year. Now each year has different commitment levels. For 2021, we've committed up to, I believe, it's $265 million when you take into account the amount that Windstream can roll over from the prior year. But generally speaking, going forward, it's going to be no more than $225 million per year, it will be the commitment. And again, most of this -- again, Windstream is making the investment themselves. They say where want to make the investment. They fund it first and then we're reimbursing them. And where most of this investment is going towards their ILEC footprint and most of it ends in on support of their Kinetic rollout and their Kinetic is their high-speed broadband offering up to 1 gig speed. And so a lot of that go in support of that, and Windstream has put out some numbers about how successful they've been on that. I believe they have added 130,000 locations in the first quarter alone, and they expect to reach between homes and businesses past and hook about 1 million homes by the end of 2021. So they're making really good progress there. Again, we review that to make sure it meets all the criteria in its fiber assets, but it becomes our asset as soon as we reimburse it even though we don't get the rent for a full 1 year after that investment. So the program is working really well, and we feel really good about the prospects of it.

Got it. Okay. Maybe you can talk about the DISH opportunity, the ramp and visibility on their 5G build-out, returns on the investment. Anything else you can share, geographies, et cetera.

Sure. I'll go ahead and take that one. So obviously, we were named as one of DISH's first 4 preferred partners on the fiber side and signed a master agreement with them last year. And so we've been working with them then on the specific markets that will be awarded and what the network design will be in those markets. We have already signed a number of market awards. We've been working through the early stages of their process to identify the specific sites and the network design that has to be put in place. And I would expect to see those orders flowing -- firming up soon for specific sites and beginning some of the installation work and so forth. And I think that will just ramp through 2021 and 2022 as they continue to proceed on their build trying to meet the key coverage criteria that they've got with the SEC. From our perspective, we focused this on on-net and near-net opportunities. We're bidding our existing markets where we already have fiber connected to a lot of towers, quite frankly, plus a lot of other fibers in the vicinity. And so this is a lease-up opportunity, not a greenfield build like those previous wireless carrier builds that we did a few years ago. And so these are going to be low CapEx, high yield. They're actually going to be faster to activate because some of them are already at the tower, others that just the nearby tower that we're edging out to. And so I think that program is going to be very accretive for us and it's going to help us grow and it should be throughout our Southeast footprint in the Uniti Fiber territory. So the primary deal, of course, is [ plug-in ] tower backhaul and fronthaul, dark fiber and lit service. And -- but there's also going to be other services that we can work with DISH on, for example, to connect them to various markets to their data centers or their interconnection points and so forth. And so I think as you see them building out really the first nationwide wireless build-out in 2 decades, that's going to spur a lot of growth, a lot of demand and obviously keeps the other wireless carriers expanding and improving as well. So we should see some good returns from all that.

Okay. Great. And besides the lease-up of your existing dark fiber, are you pursuing an opco/propco or a sale leaseback transactions? Is that still a important part of your strategy?

Yes, it is. Obviously, you know that we're very close to closing the Everstream transaction that we announced last year, and should be closing soon. But we're continuing to work on that. We've got a strong pipeline of opportunities that we pursue. Like M&A opportunities, those are ones that got to be a good fit and to take a little bit of time, but they've been working their way through. Most of our opportunities are proprietary in nature there. And what I'm looking at now is really to try to emphasize the combination of, of course, the funding that we can help with the carriers in terms of their build-out and stuff through a lease or a growth capital program like we're doing with Windstream. But more importantly, how can we bundle existing fiber that we have or customer relationships with those opco/propco sale-leaseback transactions. Like we did in the Everstream deal, we bundled our $48 million worth of the Windstream lease-up fiber in there along with the opco/propco on the operating. There will be other opportunities outside of the Southeast that I think we can take advantage of there. Again, where we're leveraging either our existing fiber footprint or other customer relationships that we can help bring with that party. So we're doing more than just the sale leaseback. We're actually a broader strategic partner with fiber assets to the customer that we will be able to bring to the table.

Okay. So on the M&A front, I mean, you say you have an active pipeline. I mean, are there large transformative deals in the pipeline. You've talked about them in the past. But it has been kind of quiet. So just anything else you can say about that?

Bill, you want to take it?

Yes. Sure, Ron. So Jeff, our M&A pipeline, the way we describe it is it's kind of broken into thirds, right? A 1/3 are smaller type of deals, 1/3 are bolt-on acquisitions, and then the 1/3 are the more transformative deals. And within the smaller deals and the larger deals, we have sale-leaseback, opco/propco transaction. So there are transformative transactions we can act on today. And again, if you look at our funnel, and most of it continues to be proprietary. A lot of these deals are privately sourced and not on any kind of timeline or any formal process. And similar to, in the past, we've done the same thing. We've been able to transact on proprietary M&A at reasonable valuations. And we used to get the same question when first spun off from Windstream is, when you guys going to do your first transaction. And it took some time. I mean it was a year after we spun off before we did our first transaction, which was the acquisition of PEG Bandwidth. But then shortly thereafter acquiring PEG, we acquired Tower Cloud. The following year we acquired Southern Light and Hunt. And then the year after that, we did our first sale leaseback and then we did our opco/propco transaction. So the deals started to come. And with each one of those deals, we did them at very reasonable valuations below the high-end of the valuations you were seeing in the marketplace. And today, when you look at the marketplace, valuations remain high, right? You're seeing platform fiber companies go for 15x, 20x-plus. Towers, that's one reason we sold our towers business, we were giving 30x plus cash flow. In fact, we got the upper end of that range, above 30x. So even though valuations remain very frothy in the marketplace and there is this discrepancy between private companies being valued higher than public companies. But we still are -- we still have transactions within our pipeline that we believe we can execute at favorable -- at reasonable valuations. And so we could do a transaction today, but we would be doing it at the high end of a valuation and maybe they may not fit exactly into our portfolio. Just for the sake of diversifying and that's not what we're interested in. We're going to be very particular and analytical in the way we go about this and how -- which transactions we're going to go after. And so we're only going to pursue transactions that come in at the right cost of capital, the right target, at right valuation. And so that takes time. And I think sometimes it gets lost on the fact that we're only 6 to 8 months removed from the settlement becoming effective with Windstream, and that overhang going away. And we most recently just refinanced our debt earlier this year that will save us about $25 million of annualized interest to help lower our cost of capital. So it sounds like a lot of time has passed, but really in reality, it hasn't been that much. And so we are focused on M&A. We want to be acquisitive, but we're going to be disciplined in our approach in how we go about that.

Got it. And just some of the -- maybe some of the larger transactions in your pipeline, what kind of EBITDA multiple do you think you would have to pay for those? And will you be able to offset some of that through a sale leaseback?

Yes. So I think in terms of the transformative M&A, I mean, it could be an outright acquisition of a fiber company or a fiber asset, but it's going to have to be ones that either further densify or expand our existing footprint, primarily in the Southeast. I wouldn't expect us to be after a company that wasn't contiguous to our existing network. In terms of multiples, I don't want to get into exact -- lock into exact range. But again, I told you that fiber platform companies are trading for 15, 20x, and we believe that's high end of the range, we would be interested in executing on something of that high multiple. But so it's going to be something lower than that. But I think the other types of transformative opportunities that we would go after would be sale-leaseback opco/propco. So for instance, we -- Uniti does not want to be -- we don't want to be owners of residential broadband. We don't have -- that doesn't fit into our strategy, but we can partner with somebody that does want to own and operate the residential broadband component of a company. And then we would acquire the fiber and then we can lease it back to that partner exclusively or retain some strands that we could use to lease to other parties. So that's one example how an opco/propco structure could work a more transformative side. So we look at many different types of transactions, but all with the scope of being disciplined in how we're going to approach them.

Got it. Okay. So with Lumen potentially looking at potentially strategic options for its mass market business. Maybe if someone wanted to acquired that business, you could do a fiber lease deal with them?

Jeff, we don't comment specific on companies or specific transactions. But we -- just I'll say we look at a lot of different things and the structures I just mentioned are really what we're focused on.

Jeff, as Bill said, we don't want to operate residential networks ourselves and serve those customers. But owning those networks and leasing them to the operator fits right into our strategy, opco/propco strategy, really for existing businesses that might want to spin out like you're talking about and also to support the new fiber-to-the-home build -- with greenfield builds. And of course, that's similar to what new with the GCI program. So I think there was a lot of opportunities in that area.

Got it. Okay. Yes, I know it's way early for guidance for '22, but maybe some general thoughts about the' '22 outlook across your key businesses.

Yes. Bill Again, we've only given our outlook for '21, and we haven't provided any outlook for '22, are not going to today. But I will just speak high level, the tailwinds -- the certain tailwinds we're seeing in '21, I would expect to continue to '22, just more earnest. So for one is 5G, right? So 5G has been rolling out predominantly in the Tier 1 markets, but we're starting to see it roll out more broadly in the Tier 2, Tier 3 markets that we're in. And so even though we've seen RFP activity already, we've done some builds in support of the venture on 5G in our markets for our wireless carriers, we would expect to see additional RFP activity there. So I think that's continue to be a driver. Even though, as Ron mentioned, and I think I said before, we don't directly participate in residential broadband, a lot of our customers do, right? So fiber-to-the-home is becoming a much bigger thing, and I think that's going to continue into next year. And you look at RDOF funding is going to continue, Phase 1 funding is already in place, Phase 2 funding is coming. You have an infrastructure bill that's being evaluated in Congress, that's probably going to change somewhat from what is it today. But there is a good portion of that, that's being allocated to broadband and developing lot of broadband in rural areas specifically. So even though we're not part of that residential broadband directly, indirectly, w should benefit from that because we have customers today and potential new customers that will partake in those fundings and will be significant tailwinds for them. Windstream being one among others. And then I think, I'll just finish real quick, Ron, I'll let you jump in. Fixed wireless, fiber-to-the-home, we believe there will continue to be the expansion of the virtualization trend here where we're using video platform to conduct these conferences. E-learning, telemedicine, these are things that we think that are around to stay and COVID helped accelerate those trends. But the common thing between all those different technologies is they require dense fiber networks to work seamlessly and work effectively, and that's where it comes in for us. So I think on that side, there's a lot of demand trends there going forward that we're well set up to capitalize on. Ron, you want to add?

Yes, I was just going to add. I think as you're thinking about 2022, you have to look at where things are really gaining momentum in 2020 and 2021, which our enterprise sales teams are doing very well, okay? Even through the pandemic shutdown, they found creative ways to be able to meet with their customers and continue to do business and that their objectives in 2020, and they're out of the gate strong in 2021. And so I think the fact that we've added sales teams to the markets that we recently completed those anchor builds in and they are now maturing and the sales funnels of those groups are maturing, I think the enterprise sales team is going to continue to see a lot of growth. And that really is high margin, low CapEx business. We target businesses or opportunities that are 1,000 feet or less than our fiber -- that's sort of on the private. That's sort of our sweet spot in terms of distance, and that creates a very nice economic transaction for us. So I think that will be a key theme as we go into the future.

Got it. So just looking at free cash flow, our estimates show the company using a little bit of cash before your dividend of $144 million, your current dividend. And this is going to require currently a use of your $500 million of liquidity to fund. So what are the opportunities to improve your cash flow to fund growth investments to fund the GCI payments to Windstream and maintain your current leverage ratio, which you've done a good job doing.

Yes. You're right. We have done a great job of that. And I would say our liquidity position is very strong today. We feel really good about it. We've made a comment in the past that for this year, 2021, we don't have a need to raise any external capital to meet any of our funding commitments, including GCI. And really, we just said 2021 because we were looking at 1 year out at that time when we made those statements. The fact of the matter -- the reality is going into 2022, we don't really have a need to raise external funding as we sit here today. And so what's going to improve and what's going to add to our free cash flow generation, it's executing on the lease-up, number one, right? So from an [ vantage ] standpoint, it's going to be driving at Uniti Fiber, this nonwireless lease of all high-margin business that we're going after. And then at Uniti Leasing, this is the same thing. It's leveraging those assets, leveraging the fiber that we acquired from Windstream the rights to, the Lumen assets that we acquired a few years ago, leasing up those fiber. We have a lot of runway. We're only utilizing below 40% -- 30%, 40% of our fiber today. And so we have a lot of runway there to lease that up, and we're seeing strong interest. I mean we talked about the funnel, how that doubled when we got the Windstream fiber, the sales -- the leasing sales pipeline doubled from $500 million in total contract value to $1 billion so its achieving on that. And again, everything is very high margin. You need leasing, we're talking margins 90%-plus with minimal CapEx required to lease up that fiber. And so you're talking about high incremental yields, high cash flow generation. The other thing is the deals that we're doing at Uniti Leasing, they're primarily structured as long-term dark fiber IRU contracts. As well -- the way the those are structured is usually the customer is up -- making significant upfront payment. So basically prepaying that lease for the 20 years upfront, and then the annual fee that they're paying is to support general operation and maintenance on that fiber. And so those upfront payments are a real source of funding or cash flow for Uniti that we can use to redeploy into the business and other things. And you mentioned leverage, I mean, yes, we had 2 successful refinancings early this year that, again, will generate about $25 million of annualized interest savings. And so our net leverage sits right in the middle of our range. We want to be in that 5.5 to 6x, and that's where we feel comfortable. And so again, I think we're in a very good liquidity position. We have a growing business that's going to continue to grow and generate significant cash flows and improve margins over time, while also having the opportunity to -- we've already refinanced our debt, but also being opportunistic with future maturities as well and able to get that cost of debt down even further.

Okay. On that topic, how are you thinking you have still the 7.125% unsecured through '24? And then you have the big 7.875% secured notes become callable February 15. I mean -- so maybe late this year, early next year, sort of a potential time frame to do some more refinancing?

Yes. Jeff, I don't want to get into exact timing and which tranches we may focus on first and not, other than we'll continue to be opportunistic, right? You saw again, we were in that -- we took that approach earlier this year. We don't have any significant debt maturities until -- due until 2024. So we'll continue to monitor the market. We'll look at the upcoming debt maturities and evaluate when they're callable, what the call premiums are and compare that to the market -- the rates in the market. And then we'll decide we'll be opportunistic where we can. But I don't want to get into specifics about which tranches we're going on or which notes we'll go after first and the timing of that.

Understood. And do you know on the secured side, if you relook at the term loan markets against the bond markets or is it sort of early to say there?

Yes. I think it's a little early to say, but I think, again, we'll evaluate everything. And we're constantly managing that and looking at that and evaluating our different options. And the good news is we have some time, right? We were successful in pushing out our maturity profile. But you're correct in that we do have some pretty high-yielding, high coupon debt coming due in the next few years, and market rates there or are below that. But again, we'll evaluate that, and we'll use the best with the evaluation between management and our Board will decide what best way to proceed there and when and how to refinance those.

Okay. Shifting to equity, either potential issuance or getting your share price up. You talked about the attractive valuations of fiber companies supporting your continued focus and investment in your network. But your share price has been weak potentially due to the market wants to see more M&A deals. So what's your thinking about this disconnect and how the company may address it?

Yes. That's a good question, Jeff. So yes, obviously, we believe our shares are undervalued, and we believe some of that is due to -- what we're doing, we're focused on executing on and the other things we talked about today, driving high-margin recurring revenue and the lease-up and driving that. It's been clouded by the Windstream overhang, right? And again, that's still recent in some investors' minds, but we're moving past that. And I think as Windstream -- I know as we begin to execute, as Windstream continues to execute and show progress in their Kinetic rollout and their broadband offering and they maintain their financial health and improvement there, I think that goes a long way in helping our story as well because they are still a significant customer and a significant part of our revenue that represents about 65% of our revenue today. So I think a lot of -- some of what we have to do on our side is do a better job of communicating as we're trying to get out here in these conferences, and talk to investors about the strategy that we're executing on and really driving high-margin recurring growth at both fiber and at leasing. And so as long as we're doing that and we're executing there, I think it will eventually -- it will -- hopefully we'll get credit for that from the investment community. And I think as more people get more comfortable with Windstream's new direction here and their rollout, I think that will help as well.

Okay. And finishing up for me, in the past, you've spoken about potential equity partners, including private equity, either as part of specific transactions, or investors in Uniti itself. I mean, is this something you're still looking at? Or is it kind of activity on that front has slowed? Maybe just anything you can say about that?

Yes. No, it definitely hasn't slowed. We remain very active and engaged with potential parties, both private equity funds and infrastructure funds on various different structures. So we talked about earlier about opco/propco, how we could do that there. And there's other transactions that we've partnered them. So we remain very active in discussions with them and view them as a potential party and the potential avenue for investments, just certain things we want to do.

Okay. Well, it's terrific. All right. With that, I want to thank Ron and Bill for being here with us today and attending the conference. And thanks, everyone, for joining.

Thank you, Jeff.

Thank you.