Charter Communications (CHTR) AI Stock Analysis

• Market Cap: $53.60B
• Dividend Yield: N/A
• Average Volume (3M): 1.35M
• Price to Earnings (P/E): 9.6
• Beta (1Y): 0.81
• Revenue Growth: 0.88%
• EPS Growth: 16.44%
• Country: US
• Employees: 94,500
• Sector: Communication Services
• Sector Strength: 74
• Industry: Telecommunications Services
• EPS (TTM): 35.19
• Shares Outstanding: 141,947,890
• 10 Day Avg. Volume: 1,383,194
• 30 Day Avg. Volume: 1,351,048
• PEG Ratio: 0.58
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.94
• Price to Cash Flow (P/CF): 3.70
• P/FCF Ratio: 13.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $427.00
• Price Target Upside: 26.22% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Charter Communications demonstrates solid financial performance, particularly in revenue growth, albeit with high leverage risks. The technical analysis supports a stable outlook, and the stock is attractively valued. Positive corporate events, including strategic mergers and debt restructuring, further bolster the company's market position.

Positive Factors

Broadband Subscriber Growth

Charter's footprint expansion within its RDOF markets is creating a significant source of annual broadband net adds that should help ease the annual rate of loss relative to its peers.

Financial Performance

Charter generated better-than-expected adjusted EBITDA growth, with a 3.4% increase, largely due to a decline in programming costs.

Mobile Business Growth

Charter is seeing healthy trends in its mobile business, which is probably the biggest opportunity given its low penetration rate today in this $200bn market.

Negative Factors

Broadband Competition

Broadband subscribers are still likely to incur annual losses as fiber coverage continues to expand and FWA remains a share taker within the value segment.

Growth Challenges

Challenges to customer, revenue, and EBITDA growth remain.

Investment Costs

The ongoing network upgrade requires a higher level of investment this year, marking it as the peak investment year.

Charter Communications Business Overview & Revenue Model

Company Description

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 video services, including video on demand, high-definition television, digital video recorder, pay-per-view services. It provides Internet services, such as security suite that protects computers from viruses and spyware, and threats from malicious actors; in-home WiFi, which provides customers with high performance wireless routers to enhance their in-home wireless Internet experience; out-of-home WiFi; and Spectrum WiFi services, as well as video services. The company 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, it provides mobile services; offers video programming, static IP and business WiFi, email and security, and multi-line telephone services, as well as Web-based service management; 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 for optimizes linear inventory. 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 and news networks. It serves approximately 32 million customers in 41 states. The company was founded in 1993 and is headquartered in Stamford, Connecticut.

How the Company Makes Money

Charter Communications generates revenue through several key streams. The primary source of income is subscription fees from its broadband internet services, which are marketed under the Spectrum brand. The company also earns significant revenue from cable television subscriptions, where it provides a variety of channel packages and on-demand content. Additionally, Charter offers mobile services, generating revenue through mobile plan subscriptions and related services. Another revenue stream comes from providing voice services, including landline and VoIP services. Charter Communications also benefits from advertising sales on its cable networks, as well as through partnerships and licensing agreements with content providers. The company's earnings are further supported by its business services division, which offers networking and communication solutions to enterprises, small businesses, and government entities.

Charter Communications Financial Statement Overview

Summary

Charter Communications displays strong revenue growth and impressive gross profit and EBIT margins. However, the high debt level poses financial risks, and the decreasing free cash flow warrants attention.

Income Statement

Charter Communications has shown strong revenue growth with a consistent increase over the years, up to $55.08 billion in 2024 from $45.76 billion in 2019. The gross profit margin is impressive, with a gross profit equaling total revenue in 2024. However, the net profit margin has room for improvement, standing at 9.22% in 2024. The EBIT and EBITDA margins show solid operational efficiency, with EBIT at 23.82% and EBITDA at 12.49% for 2024.

Balance Sheet

The company's debt-to-equity ratio is high due to substantial total debt of $93.933 billion against stockholders' equity of $15.587 billion in 2024, indicating significant leverage which could pose risks. However, return on equity is commendable at 32.6%, showcasing effective utilization of equity. The equity ratio is relatively low at 10.39%, suggesting a heavy reliance on debt.

Cash Flow

The operating cash flow remains strong and stable, with a slight decrease in recent years to $14.43 billion in 2024. Free cash flow, although positive, has declined since 2020, standing at $3.161 billion in 2024. The free cash flow to net income ratio is healthy, indicating good cash generation relative to net income.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
55.09B	54.61B	54.02B	51.68B	48.10B
	Gross Profit
30.78B	21.20B	21.15B	23.70B	21.55B
	EBIT
13.12B	12.56B	11.96B	10.53B	8.40B
	EBITDA
21.40B	20.74B	20.92B	19.77B	18.10B
	Net Income Common Stockholders
5.08B	4.56B	5.05B	4.65B	3.22B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
459.00M	709.00M	645.00M	601.00M	998.00M
	Total Assets
150.02B	147.19B	144.52B	142.49B	144.21B
	Total Debt
93.93B	97.78B	97.60B	91.56B	82.75B
	Net Debt
93.47B	97.07B	96.96B	90.96B	81.75B
	Total Liabilities
130.31B	132.47B	131.97B	124.33B	113.92B
	Stockholders Equity
15.59B	11.09B	9.12B	14.05B	23.80B
Cash Flow		Free Cash Flow
3.16B	3.49B	6.10B	8.68B	6.61B
	Operating Cash Flow
14.43B	14.43B	14.93B	16.24B	14.56B
	Investing Cash Flow
-10.65B	-11.13B	-9.11B	-7.75B	-8.16B
	Financing Cash Flow
-3.98B	-3.24B	-5.77B	-8.88B	-8.95B

Charter Communications Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 338.29
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHTR, the sentiment is Negative. The current price of 338.29 is below the 20-day moving average (MA) of 363.38, below the 50-day MA of 360.71, and below the 200-day MA of 349.48, indicating a bearish trend. The MACD of 3.52 indicates Negative momentum. The RSI at 54.17 is Neutral, neither overbought nor oversold. The STOCH value of 50.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CHTR.

Charter Communications Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TMUS	82 Outperform	$283.28B	25.67	17.93%	1.23%	3.62%	38.24%
CMCSA	77 Outperform	$126.21B	8.06	19.24%	3.71%	1.78%	11.62%
T	76 Outperform	$191.23B	17.86	10.54%	4.17%	-0.08%	-24.48%
CHTR	74 Outperform	$53.60B	9.61	38.11%	―	0.88%	16.44%
VZ	73 Outperform	$181.14B	10.38	18.27%	6.24%	0.61%	50.39%
Sector *	58 Neutral	$25.04B	3.12	-9.31%	4.26%	2.35%	-43.03%
FYBR	57 Neutral	$8.90B	―	-6.30%	―	3.23%	-1196.02%

Charter Communications Corporate Events

Charter Communications to Acquire Liberty Broadband

On February 26, 2025, Charter Communications and Liberty Broadband held special meetings where stockholders approved the merger agreement, allowing Charter to acquire Liberty Broadband. This merger is expected to close on June 30, 2027, subject to certain conditions, and will result in Liberty Broadband becoming an indirect wholly owned subsidiary of Charter, potentially impacting the company’s market position and stakeholder interests.