Financial Review: Charter Communications (CHTR) versus The Competition

Charter Communications (NASDAQ: CHTR) is one of 32 public companies in the “Cable & other pay television services” industry, but how does it compare to its rivals? We will compare Charter Communications to similar businesses based on the strength of its analyst recommendations, earnings, valuation, institutional ownership, profitability, risk and dividends.

Insider and Institutional Ownership

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72.3% of Charter Communications shares are owned by institutional investors. Comparatively, 54.2% of shares of all “Cable & other pay television services” companies are owned by institutional investors. 0.8% of Charter Communications shares are owned by company insiders. Comparatively, 10.9% of shares of all “Cable & other pay television services” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Charter Communications and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Charter Communications 23.80% 1.11% 0.35%
Charter Communications Competitors 1,300.24% 29.22% 4.79%

Analyst Recommendations

This is a summary of current ratings for Charter Communications and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Charter Communications 1 6 15 0 2.64
Charter Communications Competitors 298 1480 2281 75 2.52

Charter Communications presently has a consensus price target of $408.18, indicating a potential upside of 31.27%. As a group, “Cable & other pay television services” companies have a potential upside of 21.06%. Given Charter Communications’ stronger consensus rating and higher possible upside, research analysts clearly believe Charter Communications is more favorable than its rivals.

Earnings and Valuation

This table compares Charter Communications and its rivals gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Charter Communications $41.58 billion $9.90 billion 117.34
Charter Communications Competitors $12.86 billion $1.94 billion 56.36

Charter Communications has higher revenue and earnings than its rivals. Charter Communications is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

Charter Communications has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500. Comparatively, Charter Communications’ rivals have a beta of 1.23, suggesting that their average stock price is 23% more volatile than the S&P 500.

Summary

Charter Communications beats its rivals on 7 of the 13 factors compared.

About Charter Communications

Charter Communications, Inc., through its subsidiaries, provides cable services to residential and commercial customers in the United States. It offers subscription-based video services, including video on demand, high definition television, digital video recorder, pay-per-view, spectrum guide services, and a package of basic video programming, as well as ad-supported free online video products. The company also provides Internet services, such as security suite that protects computers from viruses and spyware; in-home WiFi, which permits customers to lease high performance wireless routers to enhance their in-home wireless Internet experience; out-of-home WiFi; parental control features; and residential Internet services. In addition, it 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. Further, the company provides video programming and music, Web hosting, email and security, and multi-line telephone services, as well as Web-based service management; and sells video and online advertising inventory to local, regional, and national advertising customers. Additionally, it offers fiber-delivered communications and managed information technology solutions; and security and home management services, as well as owns and operates regional sports networks and local sports, news, and lifestyle channels. As of December 31, 2017, the company served approximately 27.2 million residential and business customers. Charter Communications, Inc. was founded in 1999 and is based in Stamford, Connecticut.

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