Is Charter Communications Inc. (CHTR) A Risky Investment?

Charter Communications Inc. (NASDAQ:CHTR) finished Friday with a subtraction of -$4.74 to close at $730.93, a downside of -0.64 percent. An average of 772,460 shares of common stock have been traded in the last five days. There was a gain of $31.90 in the past week, and it reached a new high 39 times over the past 12 months. The last 20 days have seen an average of 789,490 shares traded, while the 50-day average volume stands at 890,300.

CHTR stock has decreased by -1.49% in the last month. The company shares reached their 1-month lowest point of $683.44 on 10/12/21. With the stock rallying to its 52-week high on 09/02/21, shares of the company touched a low of $572.46 and a high of $825.62 in 52 weeks. It has reached a new high 31 times so far this year and achieved 10.49% or $69.38 in price. In spite of this, the price is down -11.47% from the 52-week high.

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Insider Transactions

51 days have passed since Charter Communications Inc. (CHTR) last reported insider trading activity. Bickham John, who is President and COO, most recently acquired $200 shares at $825.14 per share on Sep 02. In this transaction, the insider spent $165,029. President and COO, Bickham John, disposed of 9,032 shares at a price of $824.30 on Sep 02. The insider now owns more than $7,445,057 worth of shares. Prior to that, EVP/Chief Marketing Officer Hargis Jonathan went on to Sale 5,656 shares at $794.75 each on Aug 20. An amount of $4,495,083 was transacted.

Valuation Metrics

Charter Communications Inc. (CHTR) has a trailing price-to-earnings (P/E) ratio of 38.30, which compares with the 19.30 for the broader industry and 30.57 for the sector. In the last five years, Charter Communications Inc.’s PE ratio has ranged between 125.79 and 7.101. The stock’s beta is 1.02. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 2.71, the price-to-book (PB) ratio at 7.03, and the price-to-cash flow ratio at 17.38.

The quick ratio of Charter Communications Inc. for the three months ended June 29 was 0.50, and the current ratio was 0.50, indicating that the company is not able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 4.50 and a total debt to equity ratio of 4.55 for the quarter ending June 29. Charter Communications Inc.’s EBITDA margin for the year ending June 29 is 37.77%, while its operating margin for the same period stands at 18.40%. Its gross profit as reported stood at $18.17 billion compared to revenue of $48.1 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Charter Communications Inc.’s return on assets was 2.70%. For the broader industry, ROE averaged 4.77 over the past year.

Earnings Surprise

For the three-month period that ended June 29, Charter Communications Inc. had $86.96 billion in total debt. In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $1.02 billion in the quarter, while revenues were grew 24.9%. The analyst consensus anticipated Charter Communications Inc.’s latest quarter earnings to come in at $4.78 per share, but it turned out to be $5.29, a 10.70% surprise. For the quarter, EBITDA amounted to $4.93 billion. Shareholders own equity worth $183.82 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Charter Communications Inc. (CHTR) price momentum. RSI 9-day as of the close on 22 October was 54.97%, suggesting the stock is Neutral, with historical volatility in this time frame at 15.13%.

As of today, CHTR’s price is $725.08 +4.56% or $31.90 from its 5-day moving average. CHTR is currently trading -1.11% lower than its 20-day SMA and +7.10% higher than its 100-day SMA. However, the stock’s current price level is -5.63% below the SMA50 and +16.06% above the SMA200.

The stochastic %K and %D were 71.31% and 62.64%, respectively, and the average true range (ATR) was 14.57. With the 14-day stochastic at 67.60% and the average true range at 14.48, the RSI (14) stands at 49.49%. The stock has reached 20.76 on the 9-day MACD Oscillator while the 14-day reading was at 15.69.

Analyst Ratings

Deutsche Bank downgraded Charter Communications Inc. (NASDAQ: CHTR) to a a Hold rating in its most recent analyst report. Previously, the stock was rated as a Buy. The consensus rating for Charter Communications Inc. (CHTR) among analysts is Overweight. According to current brokerage recommendations, 1 brokerage firm advise that investors sell CHTR, while 12 suggest investors hold. There are 1 analyst who rate the stock as underweight. The stock is rated overweight by 1 analysts, while 18 others rate it as a “buy”.

What is CHTR’s price target for the next 12 months?

Analysts predict a range of price targets between $665.00 and $1000.00, with a median target of $827.00. Taking a look at these predictions, the average price target given by analysts for Charter Communications Inc. (CHTR) stock is $823.38.


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