Buckingham Makes The Bull Case For Charter Communications
Shares of Charter Communications, Inc. (NASDAQ: CHTR) have lost nearly 15 percent over the past three months, but some analysts are confident enough in the cable company's 2018 prospects to recommend buying the stock.
The Analyst
The Buckingham Research Group's Matthew Harrigan initiated coverage of Charter's stock with a Buy and $415 price target.
The Thesis
Charter remains focused on enacting its "operational playbook" across the legacy Time Warner Cable and Bright House footprints, Harrigan said in the Wednesday initiation note.
By applying the Charter Spectrum pricing and product packaging across the entire new Charter footprint, management's "volume-oriented strategy" could grow customer relationships by 5 to 6 percent annually and also reduce requisite service transactions, the analyst said.
A Charter broadband home is worth nearly 2.8 times a video home, which results in shared costs, relative CPE needs and churn effects, the analyst said. This figure could increase to 3.4x, assuming a $10 standalone monthly broadband pricing premium, Harrigan said.
Charter is busy creating "superior long-term financial engineering upside relative to immediate M&A," according to Buckingham. The firm projects that Charter is likely to retire over 25 percent of its shares through 2021, but is unlikely to be paying a dividend.
Price Action
Charter stock was down slightly at the close Wednesday at $329.
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Latest Ratings for CHTR
Date | Firm | Action | From | To |
---|---|---|---|---|
Jan 2021 | KeyBanc | Maintains | Overweight | |
Jan 2021 | Raymond James | Maintains | Outperform | |
Dec 2020 | Morgan Stanley | Maintains | Overweight |
View More Analyst Ratings for CHTR
View the Latest Analyst Ratings
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