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Verizon Fools Frontier Again

We were pleased to see that Verizon Communications (NYSE:VZ) was able to reach an agreement to sell some of its wireline assets for $10B recently. However, we were absolutely stunned to see that Frontier Communications (NASDAQ:FTR) was willing to purchase these assets from Verizon because we remembered that its $8.7B wireline purchase in 2010 did not work out so well for it. When we consider that Frontier's share price declined by nearly 60% from 2010-2012 after the deal closed before recovering those losses since 2012, we were shocked that Frontier's share price increased by 10.6% in response to its announcement that it was buying assets from Verizon. Frontier's pro forma revenue has declined by 30% since 2009, its residential consumer base declined by 33%, its operating income declined by 34% and its dividend declined by 60% since then. Albert Einstein said that insanity is doing the same thing over again and expecting a different result and we think that Frontier's CEO Maggie Wilderotter has come down with a serious case of insanity for her willingness to buy whatever Verizon is selling. As such, we think income-oriented telecom investors should consider accumulating shares of Verizon, and selling or shorting…