How Aussie Broadband (ASX:ABB) is just smashing it right now

The little battler this week won massive bragging rights over its larger competitors. So where will its shares head from here?

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You can’t wipe the smiles off the faces of Aussie Broadband Ltd (ASX: ABB) shareholders this year, as they’ve seen their investments rise 150%.

Now they have even more to cheer about.

Global internet testing company Ookla released its latest quarterly figures this week, declaring Aussie Broadband the fastest fixed broadband provider in Australia.

In fact, the competition wasn’t even close as Aussie scored 88.33 on the speed test, with the next closest Optus sitting on 59.81:

Internet service provider Speed score
Aussie Broadband 88.33
Optus 59.81
iiNet (TPG Telecom Ltd (ASX: TPG)) 58.20
TPG (TPG Telecom Ltd (ASX: TPG)) 53.93
Vodafone (TPG Telecom Ltd (ASX: TPG)) 52.70
Telstra Corporation Ltd (ASX: TLS) 49.00
Source: Ookla, table created by author

Shaw and Partners senior investment adviser Adam Dawes said last week he “really likes” Aussie Broadband shares.

“It’s taking a lot of market share from Telstra,” he said.

“Telstra is so big, so cumbersome, it can’t be nimble. Aussie Broadband is very, very nimble.”

Not just fast, but consistent

However, Aussie Broadband didn’t rate as the fastest provider overall with a small sample of superfast users dragging up the average.

Ookla also analysed for the most consistent internet service provider, and Aussie came out on top again:

Internet service provider Consistency score
Aussie Broadband 85.7%
Vodafone 83.2%
Optus 82.1%
Telstra 77%
TPG 75.9%
iiNet 74.5%
Source: Ookla, table created by author

Just last month Aussie Broadband used its bullish share price to raise more than $130 million from both institutional and retail investors.

“They are going to make some more acquisitions which will be EPS [earnings per share] accretive,” said Dawes.

“As well, we expect them to announce some other deals with the NBN and some fibre stuff.”

Aussie Broadband made it a trifecta in Ookla’s latest quarterly report, topping the league table for network latency as well:

Internet service provider Median latency (milliseconds)
Aussie Broadband 9
iiNet 9
TPG 10
Telstra 10
Vodafone 10
Optus 10
Source: Ookla, table created by author

Latency is an important measure of performance as it’s a measure of how delayed the broadband response is.

An internet connection can be blindingly quick but if it has high latency, it becomes unusable for uses like games and streaming.

Aussie Broadband shares are trading for $5.20 early Tuesday afternoon.

“We’ve got a $5.50 price target on it,” said Dawes last week.

“I think there’s a little bit of room to move on the upside on that one.”

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Motley Fool contributor Tony Yoo owns shares of Aussie Broadband Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Aussie Broadband Limited. The Motley Fool Australia owns shares of and has recommended Telstra Corporation Limited. The Motley Fool Australia has recommended Aussie Broadband Limited and TPG Telecom Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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