CHTR - Charter's Future Clouded By Competitive Pressures Despite Strategic Investments Analysts Say | Benzinga
Oppenheimer analyst Timothy Horan had a Perform rating on Charter Communications, Inc (NASDAQ:CHTR).
Last week, the company reported fourth-quarter FY23 revenue growth of 0.3% year-on-year to $13.711 billion, beating the consensus of $13.699 billion. EPS of $7.07 missed the consensus of $8.73.
The analyst noted that weak results continue to be driven by the secular decline of legacy services and new competition.
Broadband additions have stopped from significant competitive pressure from FWA, which could capture ~4 million net adds annually, and fiber competition, as per Horan.
Positively, CHTR is aggressively investing in its network and digitizing its cost structure and video model, he stated.
Its new Xumo platform seamlessly integrates linear TV and OTT video, enabling a unique and attractive service when bundled with wireless.
It remains the right strategy long-term, but aggressive promos, a weak balance sheet, high capital expenditure, and weaker subscriber growth remain short-term risks.
The analyst also noted that CHTR is relatively expensive compared to peers at a 5.5% FY24 free cash flow yield versus peers at 7-14%.
The analyst projects first-quarter revenue and EPS of $13.71 billion (versus consensus of $13.79 billion) ...