Stock of the Day

June 8, 2021

Charter Communications (CHTR)

$361.04
-$1.97 (-0.5%)
Market Cap: $51.62B

About Charter Communications

Charter Communications, Inc. operates as a broadband connectivity and cable operator company serving residential and commercial customers in the United States. The company offers subscription-based internet, video, and mobile and voice services; a suite of broadband connectivity services, including fixed internet, WiFi, and mobile; Advanced WiFi services; Spectrum Security Shield; in-home WiFi, which provides customers with high performance wireless routers and managed WiFi services to enhance their fixed wireless internet experience; out-of-home WiFi; and Spectrum WiFi services. It also offers voice communications services using voice over internet protocol technology; and broadband communications solutions, such as internet access, data networking, fiber connectivity, video entertainment, and business telephone services to cellular towers and office buildings for business and carrier organizations. In addition, the company provides mobile services; video programming, static IP and business WiFi, voice, and e-mail and security services; sells local advertising across various platforms for networks, such as TBS, CNN, and ESPN; sells advertising inventory to local sports and news channels; and offers Audience App to create data-driven linear TV campaigns for local advertisers. Further, the company offers communications products and managed service solutions; data connectivity services to mobile and wireline carriers on a wholesale basis; and owns and operates regional sports networks and news channels. It serves approximately 32 million customers in 41 states. Charter Communications, Inc.was founded in 1993 and is headquartered in Stamford, Connecticut.

Charter Communications Bull Case

Here are some ways that investors could benefit from investing in Charter Communications, Inc.:

  • Charter Communications, Inc. reported an impressive earnings per share (EPS) of $10.10 for the latest quarter, significantly surpassing analysts' expectations of $9.14. This strong performance indicates robust profitability and effective management.
  • The company has a high return on equity (ROE) of 29.01%, suggesting that it is efficient in generating profits from its equity investments, which is a positive sign for potential investors.
  • Recent analyst upgrades have increased the price targets for Charter Communications, Inc., with Pivotal Research raising their target to $525.00, indicating strong market confidence in the company's future performance.
  • The current stock price is $340.26, which is below many analysts' price targets, suggesting potential for price appreciation as the market adjusts to the company's strong fundamentals.
  • Charter Communications, Inc. has a net margin of 9.23%, reflecting its ability to convert revenue into actual profit, which is crucial for sustaining growth and providing returns to shareholders.

Charter Communications Bear Case

Investors should be bearish about investing in Charter Communications, Inc. for these reasons:

  • The company has a high debt-to-equity ratio of 4.73, indicating that it relies heavily on debt financing. This could pose risks, especially in a rising interest rate environment, as it may affect profitability and cash flow.
  • Despite recent upgrades, four analysts have rated the stock with a sell rating, which may suggest underlying concerns about the company's long-term growth prospects.
  • The stock has experienced volatility, with a 1-year low of $236.08 and a high of $415.27, indicating potential risks associated with price fluctuations that could impact investor returns.
  • The company has a quick ratio of 0.34 and a current ratio of 0.31, both of which are below 1.0, suggesting potential liquidity issues that could affect its ability to meet short-term obligations.
  • Market sentiment may be cautious due to the competitive landscape in the broadband and cable industry, which could impact future growth and profitability for Charter Communications, Inc.

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