In an "Executive Decision" segment, Cramer sat down with Maggie Wilderotter, chairman and CEO of Frontier Communications (FTR), a stock which Cramer recently placed in the "Sell Block" after the company slashed its dividend by 25% when it acquired 4.8 million access lines from Verizon (VZ).
Wilderotter said Frontier has been a high-paying dividend company since 2004, and chose to reduce its dividend to investing in new markets, grow revenue and created even more cash flow going forward. She noted that even after the reduction, Frontier is still one of the highest-yielding companies in the S&P 500.
Wilderotter also noted that the deal with Verizon was initiated by her, and de-leveraged the company from 3.9 times earnings to just 2.6 times earnings. She said Frontier's billing systems are also scalable, allowing the company to easily absorb the new lines. In addition, Wilderotter said she's "very comfortable" with the $500 million in synergies predicted from the deal.When asked about the 11.2% loss of lines reported from the deal, Wilderotter said she knows how to turn that tide around, and Frontier had lower- than-average line losses before the deal. Finally, when asked whether the dividend is safe, Wilderotter said simply, "Yes." Cramer said he felt better about Frontier after having the conversation, and investors should, too.