Morningstar Rating
Stock XNAS Rating as of
$270.83 −0.56(0.21%)
View Full ChartAs of Cboe BZX Real-Time Price Open
Unlock our analysis with Morningstar Investor
Company Report
Company Report
Charter Earnings: The Next Couple of Quarters Will Be Tough, but the Stock Looks Cheap
Michael Hodel
While the end of the federal Affordable Connectivity Program remains an issue for Charter and customer metrics remain weak, profitability was a notable positive in the firm's first-quarter results. Charter has been the biggest beneficiary of the ACP, with 5 million (about 16%) of its broadband customers receiving the subsidy. Management expects weak customer growth over the next couple of quarters, but it believes EBITDA will grow in 2024 despite the program's end. After trimming our fair value estimate to $500 recently to include an estimate of the ACP impact, we are dropping our estimate to $490, primarily on expectations for slower business customer growth. We still believe Charter shares are deeply undervalued, but we caution that uncertainty is higher than with cable peer Comcast.
Price vs Fair Value
Price vs Fair Value
CHTR is trading at a 878% premium.
Price
$271.46
Fair Value
$296.00
Uncertainty
High
- 1-Star Price
- $516.40
- 5-Star Price
- $643.00
- Economic Moat
- Bwhrfp
- Capital Allocation
- Xnvlrqnr
Bulls Say, Bears Say
Bulls Say, Bears Say
Bulls
Like its cable peers, Charter’s networks provide a platform to easily meet customers’ growing bandwidth demands, which should drive market share gains and strong recurring cash flow.
Bears
Charter has a reputation for poor customer service. As high-quality alternatives emerge, including fixed-wireless, many customers will jump ship.
Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if CHTR is a good fit for your portfolio.
News
News
- Ad-Supported Paramount+ to Be Included in Charter's Spectrum Packages Under New Deal
- PARAMOUNT GLOBAL AND CHARTER COMMUNICATIONS ANNOUNCE NEW MULTI-YEAR AGREEMENT FOR DISTRIBUTION OF PARAMOUNT'S LINEAR NETWORKS, CBS OWNED-AND-OPERATED STATIONS AND DIRECT-TO-CONSUMER STREAMING SERVICES
- PARAMOUNT GLOBAL AND CHARTER COMMUNICATIONS ANNOUNCE NEW MULTI-YEAR AGREEMENT FOR DISTRIBUTION OF PARAMOUNT'S LINEAR NETWORKS, CBS OWNED-AND-OPERATED STATIONS AND DIRECT-TO-CONSUMER STREAMING SERVICES
- Charter Announces Pricing for Tender Offer for 4.908% Senior Secured Notes due 2025
- Charter Announces Upsize and Early Tender Results for 4.908% Senior Secured Notes due 2025
- SPECTRUM OFFERS TO PAY UP TO $2,500 TO CUSTOMERS WHO SWITCH TO SPECTRUM MOBILE™
- Charter Closes $3.0 Billion Senior Secured Notes
- Charter Announces Amended Tender Offer for Debt Securities
Trading Information
Trading Information
- Previous Close Price
- $271.39
- Day Range
$269.65–272.80
- 52-Week Range
$236.50–458.11
- Bid/Ask
- $270.74/$271.64
- Market Cap
- $39.21 Bil
- Volume/Avg
- 1,165/1.4 Mil
Key Statistics
Key Statistics
- Price/Earnings (Normalized)
- 8.12
- Price/Sales
- 0.74
- Dividend Yield (Trailing)
- —
- Dividend Yield (Forward)
- —
- Total Yield
- 7.21%
Company Profile
Company Profile
Charter is the product of the 2016 merger of three cable companies, each with a decades-long history in the business: Legacy Charter, Time Warner Cable, and Bright House Networks. The firm now holds networks capable of providing television, internet access, and phone services to roughly 57 million US homes and businesses, around 40% of the country. Across this footprint, Charter serves 30 million residential and 2 million commercial customer accounts under the Spectrum brand, making it the second-largest US cable company behind Comcast. The firm also owns, in whole or in part, sports and news networks, including Spectrum SportsNet (long-term local rights to Los Angeles Lakers games), SportsNet LA (Los Angeles Dodgers), SportsNet New York (New York Mets), and Spectrum News NY1.
- Sector
- Communication Services
- Industry
- Telecom Services
- Stock Style Box
- Mid Value
- Total Number of Employees
- 101,100
- Website
- https://corporate.charter.com
Competitors
Competitors
- Lumen Technologies Inc Ordinary Shares LUMN
- Verizon Communications Inc VZ
Valuation
Valuation
| Metric | CHTR | LUMN | VZ |
|---|---|---|---|
Price/Earnings (Normalized) | 8.12 | 25.43 | 8.61 |
Price/Book Value | 3.26 | 2.60 | 1.80 |
Price/Sales | 0.74 | 0.09 | 1.26 |
Price/Cash Flow | 2.70 | 0.46 | 4.42 |
Price/Earnings
CHTR
LUMN
VZ
Financial Strength
Financial Strength
| Metric | CHTR | LUMN | VZ |
|---|---|---|---|
Quick Ratio | 0.34 | 0.77 | 0.52 |
Current Ratio | 0.40 | 1.03 | 0.71 |
Interest Coverage | 2.34 | −8.33 | 3.72 |
Quick Ratio
CHTR
LUMN
VZ
Profitability
Profitability
| Metric | CHTR | LUMN | VZ |
|---|---|---|---|
Return on Assets (Normalized) | 3.93% | −0.98% | 4.66% |
Return on Equity (Normalized) | 53.43% | −11.06% | 18.99% |
Return on Invested Capital (Normalized) | 8.68% | 3.01% | 7.89% |
Return on Assets
CHTR
LUMN
VZ
See how this stock stacks up to its competitors with Morningstar Investor
Telecom Services Industry Comparables
Telecom Services Industry Comparables
| Ticker | Name | Morningstar Rating for Stocks | Capital Allocation | Economic Moat | Market Cap |
|---|---|---|---|---|---|
| TMUS | T-Mobile US Inc | Frmvfrytxb | Zqjbmf | $194.5 Bil | |
| VZ | Verizon Communications Inc | Skvlfkgsm | Zdntp | $167.3 Bil | |
| CMCSA | Comcast Corp Class A | Dszyghcw | Fvc | $151.2 Bil | |
| T | Ddd | Ywydjd | $125.5 Bil | ||
| DTEGY | Deutsche Telekom AG ADR | Wdwvkxhrc | Bssrtp | $117.5 Bil | |
| AMX | America Movil SAB de CV ADR - Series B | Kklydtby | Ghvslrs | $59.9 Bil | |
| KDDIY | KDDI Corp ADR | Kyjnvdvpc | Qldhvh | $57.7 Bil | |
| ORAN | Orange SA ADR | Jmjqtzs | Glgr | $30.9 Bil | |
| BCE | BCE Inc | Zfcxwgpt | Pbjyf | $30.7 Bil |
