We bought and sold cable service provider Charter Communications, Inc. (CHTR) four times since 2019 with the most recent being in April 2021, recalls David Fried, buyback specialist and editor of The Buyback Letter.
Charter is a broadband communications company and the second largest cable operator in the U.S. Charter provides a full range of advanced residential services including TV programming, Internet, voice and mobile. It also provides Internet, business telephone and TV services to small and medium-sized business organizations.
The company's Spectrum brand provides cable TV, internet, and home phone services to more than 32 million customers in 41 states. Spectrum Networks and Spectrum Originals distribute news coverage, sports, and original programming. It was founded in 1993, based in Connecticut and has 98,000 employees.
Charter is near the top of the list of biggest entertainment companies, with a market cap of about $65 billion. The cable TV industry is cooking along, benefiting from a high demand for high-speed broadband and increased demand for Wi-Fi devices and wireless Internet.
Our ever-growing consumption of media, whether it’s for working/learning, or for entertainment/pleasure, has been a boost for this industry. However, companies are still watching out for weakened subscriber trends due to cord-cutting and competition.
Charter, a historically strong performer, has been talked about as a growth stock lately. The historical EPS growth rate for Charter is 82.5%, and projected growth is 27.3% this year; industry average projected growth is 19.9%.
It also has a better-than-average sales-to-total-assets ratio (a measure of how efficient a company is in using its assets to generate sales), and sales are expected to grow 4.8% this year (as compared to the industry average of 0%).
It’s also being talked about as a value stock that is currently undervalued considering the strength of its earnings outlook. In the last 12 months, management has reduced shares outstanding by 12.60%.