Charter Communications, Inc. (CHTR), with a market cap of $44.8 billion, is a leading U.S. broadband communications and cable operator serving 32 million customers across 41 states. The Stamford, Connecticut-based company is expected to announce its fiscal Q2 earnings results before the market opens on Friday, Jul. 26.
Ahead of this event, analysts anticipate the cable provider to report a profit of $7.94 per share, a slight decrease of 1.4% from the year-ago quarter's $8.05 per share. The company has a mixed earnings surprise history, having exceeded Wall Street's bottom-line estimates in two of the past four quarters while falling short on two other occasions. In the most recent quarter, the company’s EPS of $7.55 jumped 13.5% year over year but narrowly missed the consensus EPS estimate due to broadband subscriber losses.
For fiscal 2024, analysts expect CHTR to report EPS of $32.16, up 7.2% from $29.99 in fiscal 2023.
On a YTD basis, CHTR has significantly underperformed the broader markets, with shares dropping nearly 20%, while the S&P 500 Index ($SPX) has gained 17.7%, and the S&P 500 Communication Sector SPDR (XLC) has returned 18.8% over the same period.
In early February this year, Charter Communications' stock crashed 16.5% following a significant earnings miss for Q4 despite meeting the sales estimate. The company faced challenges with declining internet customers, offset by gains in mobile customers.
Moreover, the stock dropped on Apr. 26 due to larger-than-expected broadband subscriber losses and a Q1 profit miss, exacerbated by increased spending on network expansion. Plus, the company's free cash flow fell below expectations due to higher network expansion costs, and the looming end of the Affordable Connectivity Program (ACP) added to concerns about future customer growth.
Analysts' consensus view on Charter Communications stock remains cautiously optimistic, with a "Moderate Buy" rating overall. Out of 23 analysts covering the stock, eight recommend a "Strong Buy," 12 give a "Hold" rating, and three advise a "Strong Sell." This configuration is slightly more bullish than three months before, with seven analysts suggesting a "Strong Buy." The average analyst price target for CHTR is $335.95, suggesting a potential upside of 8% from the current levels.
On the date of publication, Sohini Mondal 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.
