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March 27, 2020, 12:15 p.m. EDT

Is There More Upside to Charter's Stock Price?

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Mar 27, 2020 (Market Realist via COMTEX) -- On Thursday, Charter Communications /zigman2/quotes/201656355/composite CHTR -1.72% stock rose 7.9% and closed at $454.17. Based on the last closing price, the company has a market cap of $106.4 billion. The stock price has risen 15.6% in the trailing five-day period, while it has risen 27.6% in the trailing 12-month period.

Currently, Charter Communications stock is trading 16.9% lower than its 52-week high of $546.54 on February 19. The stock is also trading 32.4% higher than its 52-week low of $343.15 on April 3, 2019. On a YTD (year-to-date) basis, the stock has fallen by 6.4% as of Thursday. In comparison, the broader S&P 500 Index has fallen by about 20% YTD.

Analysts' recommendations for Charter stock

Among the 34 analysts covering Charter Communications stock, 22 have a "buy" rating on the stock--up from 21 last month. Meanwhile, 12 analysts have a "hold" rating on the stock--unchanged from last month. None of the analysts have a "sell" rating on the stock.

Analysts have an average target price of $546.17 on Charter Communications. The target price implies a return of 20.3% based on the closing price of $454.17 on Thursday. The consensus target price for the stock has fallen from $556.34 in February--a fall of 1.8%. The lowest target price estimate is $375, while the highest is $635.

Earlier this week, Citi reduced its target price on Charter stock from $605 to $457, while J.P. Morgan reduced its target price from $600 to $550. On March 16, Raymond James analyst Frank Louthan downgraded Charter Communications stock to "outperform" from "strong buy." The analyst also lowered its target price on the stock from $600 to $500. According to a report from TheFly , "The analyst says the need for broadband should increase in this environment, with some offsetting margin pressure from additional benevolent actions undertaken by Charter and at the behest of the FCC." The report also said, "He adds that if Charter continues its share repurchases aggressively at current levels, this benefit investors and help valuation, but he does not believe levered names, regardless of business model, are likely to do well in a recessionary environment."

Dish Network /zigman2/quotes/207505872/composite DISH +3.11% and Comcast /zigman2/quotes/209472081/composite CMCSA +1.94% have average broker target prices of $41.41 and $48.85, respectively. These figures imply returns of 85.5% and 33.0%, respectively, over the next 12 months.

Charter's growth projection

Charter Communications reported sales of $11.76 billion in the fourth quarter of 2019--a rise of 4.7% YoY (year-over-year) from sales of $11.23 billion in the fourth quarter of 2018. The company reported an adjusted EPS of $3.28 in the fourth quarter of 2019 compared to $1.29 in the fourth quarter of 2018. Wall Street analysts expected the company to post sales of $11.73 billion and earnings of $2.48 in the fourth quarter of 2019.

In 2019, Charter Communications lost 462,000 net video customers due to intense competition from online video services like Netflix. The company has been focusing on its high-speed Internet business amid cord-cutting. Charter Communications added 1.41 million net high-speed Internet subscribers last year.

Analysts expect Charter Communications to report sales of $11.8 billion in the first quarter. The figure would mark a rise of 5.4% YoY compared to $11.2 billion in the first quarter of 2019. Also, analysts expect the company to report an adjusted EPS of $2.77 in the first quarter compared to $1.11 in the same period last year. Currently, analysts expect a 5.5% and 4.1% rise in the company's 2020 and 2021 revenues, respectively. They expect an adjusted EPS of $13.99 and $19.90 in 2020 and 2021, respectively.

Charter's stock returns

On Thursday, Charter Communications stock was trading 2.2% above its 20-day moving average of $444.35. Meanwhile, the stock is trading 7.2% below its 50-day moving average of $489.62 and 6.2% below its 100-day moving average of $483.99. The stock's 14-day relative strength index score of 51 suggests that it isn't "oversold" or "overbought."

Charter has a lower Bollinger Band level of $349.59. The company's middle Bollinger Band level is $444.35, while its upper Bollinger Band level is $539.10. On Thursday, Charter Communications stock closed near its middle Bollinger Band level, which also suggests that the stock is neutral.

Charter Communications stock is trending downward in today's trading session. The stock fell by 3.1% at 10:48 AM ET. Read Snapshot: Should Investors Buy or Sell Charter Stock? to learn more.

COMTEX_363906292/2648/2020-03-27T12:15:22

/zigman2/quotes/201656355/composite
US : U.S.: Nasdaq
$ 530.72
-9.31 -1.72%
Volume: 1.33M
June 5, 2020 4:00p
P/E Ratio
64.16
Dividend Yield
N/A
Market Cap
$126.47 billion
Rev. per Employee
$445,245
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/zigman2/quotes/207505872/composite
US : U.S.: Nasdaq
$ 35.82
+1.08 +3.11%
Volume: 4.75M
June 5, 2020 4:00p
P/E Ratio
17.26
Dividend Yield
N/A
Market Cap
$18.21 billion
Rev. per Employee
$851,331
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/zigman2/quotes/209472081/composite
US : U.S.: Nasdaq
$ 42.09
+0.80 +1.94%
Volume: 20.55M
June 5, 2020 4:00p
P/E Ratio
16.73
Dividend Yield
2.18%
Market Cap
$188.45 billion
Rev. per Employee
$513,625
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