Charter Communications Faces Stock Struggles Amid Market Gains
Company Overview: Charter Communications, Inc. (CHTR) is one of the foremost providers in broadband connectivity and cable services, based in Stamford, Connecticut. With a market capitalization of $55.2 billion, CHTR operates under the Spectrum brand, offering a wide range of services including broadband, video, mobile, and voice to both residential and business customers.
Stock Performance vs. the Market: Over the past year, CHTR shares have lagged behind the broader market. The stock has dropped 4.2%, while the S&P 500 Index ($SPX) has surged nearly 31% during that same period. Year-to-date in 2024, CHTR has seen a slight decline, whereas the SPX has recorded a robust gain of 25.2%.
Looking at a narrower segment, CHTR’s performance has also been lower than that of the Communication Services Select Sector SPDR ETF (XLC), which has achieved a substantial gain of 36.1% over the past year and 33.3% year-to-date.
Recent Developments: On November 13, CHTR shares jumped more than 3% following the announcement of an all-stock agreement to acquire Liberty Broadband. Earlier, on November 1, shares surged over 11% after the company reported strong Q3 earnings, exceeding both revenue and profit expectations.
Future Earnings Expectations: For the fiscal year concluding in December, analysts project that CHTR’s earnings per share (EPS) will increase by 9.6%, reaching $32.87 on a diluted basis. The company has had a mixed history with earnings surprises, meeting or beating estimates in half of the last four quarters.
Analysts’ Consensus: Among 24 analysts tracking CHTR, the average recommendation is a “Hold.” This consensus includes eight “Strong Buy” ratings, 11 “Holds,” and five “Strong Sells.” Notably, this current consensus is more upbeat than a month ago when only seven analysts rated the stock as a “Strong Buy.”
Price Target Changes: On November 4, RBC Capital Markets increased its price target for Charter Communications from $345 to $390 while maintaining a “Sector-Perform” rating. This adjustment came after the strong Q3 earnings that surpassed both RBC and overall expectations for subscriber growth and financial results. The revision reflects optimistic financial modeling and anticipated capital savings that could enable stock buybacks.
The mean price target now stands at $405.52, indicating a potential upside of 4.4% compared to CHTR’s current price. The highest price target on record is $660, suggesting an ambitious upside potential of 70%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
