10 Worst Booming Stocks to Buy According to Short Sellers

5. Frontier Communications Parent Inc. (NASDAQ:FYBR)

Year-to-Date Performance as of September 14: 41.1%

Short % of Shares Outstanding as of September 14: 11.7%

Number of Hedge Fund Holders: 36

Frontier Communications Parent Inc. (NASDAQ:FYBR) is an integrated telecommunication services company that provides broadband, video, voice, and other value-added services in the communication services sector. It is based in Dallas, Texas.

Most investors following Frontier Communications Parent Inc. (NASDAQ:FYBR) right now are aware of the fact that Verizon is planning to acquire this company. While the deal seems to make sense, it has sparked concerns, particularly considering the fact that Frontier Communications Parent Inc. (NASDAQ:FYBR) has been facing financial struggles.

Frontier Communications Parent Inc. (NASDAQ:FYBR) has about $11 billion in long-term debt, and its revenue growth in the second quarter of 2% year-over-year, while encouraging, highlights that the company is not growing revenue at a rate high enough to be able to pay off its debt any time soon. This would mean that if Verizon completes its acquisition, the debt repayment would fall in its pile of responsibilities – a factor that might dissuade Verizon from moving ahead with the deal.

However, there are factors that make Frontier Communications Parent Inc. (NASDAQ:FYBR) a good investment, too. In the second quarter, the company managed to accelerate its fiber revenue growth by 13%. Frontier Communications Parent Inc. (NASDAQ:FYBR) also added a record 92,000 new fiber broadband customers this quarter, which is 37% more than last year. Seeing as how fiber is steadily being considered the more superior telecommunication product, Frontier Communications Parent Inc. (NASDAQ:FYBR) is beginning to command more market share in this space as well.

Frontier Communications Parent Inc. (NASDAQ:FYBR) had 36 hedge funds long its stock in the second quarter, with a total stake value of $2.4 billion.