One-glance verdict
Within fair range
$88.96 our estimate vs market $138.02
Wall Street consensus: $230.24 (158.8% higher than our fair-value estimate)
55% above our estimate
Fundamentals snapshot
Charter Communications, Inc.
CHTR · NMS · Communication Services · Telecom Services
Current price
$138.02
52-week range
$124.05 - $413.14
Market cap
$21.62B
Balance sheet
Distressed
2.64x Stretched
Net debt $96.31B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Returns 27.5% on equity, ahead of 80% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Reward Trades at 3.7x P/E vs peer median 8.7x (57.3% cheaper).
What this company does
Charter Communications, Inc.
Charter Communications, which most people know as Spectrum, provides internet, cable TV, and mobile phone services to millions of households and businesses. The company's business is built on recurring revenue (income that comes in regularly, like a monthly bill), as most of its money comes from customers paying for their subscriptions each month. This steady income is important because it allows Charter to consistently invest in faster internet speeds and better services for its large customer base.
How the company got here
Charter Communications was founded in 1993 and grew by buying up smaller cable systems across the country. A major turning point came in 1998 when Microsoft co-founder Paul Allen bought the company, helping it expand aggressively. The most significant event was in 2016, when Charter acquired its much larger rivals, Time Warner Cable and Bright House Networks. This massive deal transformed Charter into one of the largest cable and internet providers in the United States, now known to most people by its brand name, Spectrum.
What it actually does
Charter Communications, through its Spectrum brand, is a company that connects homes and businesses to the internet, provides cable TV, and offers mobile and home phone services. [9, 10, 13] Think of them as the utility company for your digital life, delivering entertainment and communication through the wires that run into your home or office. They serve over 32 million customers (people or businesses paying for a service) across 41 states. [5, 10, 15] Their main business is selling these services on a monthly subscription basis.
Residential Internet
This is Charter's most important and profitable business, making up the largest slice of its sales. [5, 17] The company sells high-speed internet connections to millions of households for things like streaming movies, working from home, and online gaming. Customers pay a monthly fee for a specific internet speed. This segment is the foundation of the company, as a home internet connection is often the first product a customer buys from them.
Residential Video
This is the traditional cable TV service that many people are familiar with, offering a variety of channel packages. Customers pay a monthly subscription fee for access to live TV channels, on-demand movies, and sports. While this was once the main business, it has become a smaller part of the company's focus as more people switch to streaming services (a trend often called 'cord-cutting'). [5, 23] The company now also offers its own streaming TV app.
Residential Mobile
A newer and fast-growing part of the company, Spectrum Mobile offers wireless phone service similar to Verizon or AT&T. [5, 24] It operates by using Verizon's cell tower network, so it doesn't have to build its own. [16] Charter primarily sells this service to its home internet customers, often in a discounted bundle, to encourage them to buy more services and remain loyal customers. [5]
Commercial Services
This division sells internet, phone, and video services to businesses, from small local shops to large corporations and government offices. [1, 3, 8] Business customers typically pay higher prices than residential customers for more powerful, reliable connections and dedicated customer support. This is a significant and steady source of revenue (money the company earns from sales) for Charter.
Advertising Sales
Charter also makes money by selling advertising time to other businesses. [1, 15] These ads run during commercial breaks on the cable TV channels it provides to its subscribers. While not as large as its internet or video businesses, it provides an additional way for the company to earn money from its network.
What management is betting on now
Charter's main focus is to grow its internet and mobile businesses together. [2] The company is heavily investing in upgrading its physical network to deliver faster internet speeds to better compete with fiber optic providers. [4, 20] They are also focused on 'convergence,' which means bundling home internet and mobile phone services together to increase customer loyalty and reduce churn (the rate at which customers cancel their service). [5, 8] Finally, Charter is expanding its network into less-populated rural areas, often with government financial support, to find new customers. [8, 22]
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$1.00B
FY2024 Q3
$1.34B
FY2024 Q4
$398.00M
FY2025 Q1
$1.84B
FY2025 Q2
$726.00M
FY2025 Q3
$1.43B
FY2025 Q4
$426.00M
FY2026 Q1
$1.45B
Revenue
$13.60B
Net income
$1.16B
Diluted EPS
9.17
Operating cash flow
$4.30B
Free cash flow
$1.45B
Fetching…
Sources
Revenue
$13.60B
Net income
$1.33B
Diluted EPS
10.27
Operating cash flow
$3.76B
Free cash flow
$426.00M
Fetching…
Sources
Revenue
$13.67B
Net income
$1.14B
Diluted EPS
8.34
Operating cash flow
$4.48B
Free cash flow
$1.43B
Fetching…
Sources
Revenue
$13.77B
Net income
$1.30B
Diluted EPS
9.18
Operating cash flow
$3.60B
Free cash flow
$726.00M
Fetching…
Sources
Revenue
$13.73B
Net income
$1.22B
Diluted EPS
8.42
Operating cash flow
$4.24B
Free cash flow
$1.84B
Fetching…
Sources
Revenue
$13.93B
Net income
$1.47B
Diluted EPS
10.11
Operating cash flow
$3.46B
Free cash flow
$398.00M
Fetching…
Sources
Revenue
$13.79B
Net income
$1.28B
Diluted EPS
8.82
Operating cash flow
$3.90B
Free cash flow
$1.34B
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Sources
Revenue
$13.69B
Net income
$1.23B
Diluted EPS
8.49
Operating cash flow
$3.85B
Free cash flow
$1.00B
Fetching…
Sources
Is it cheap or expensive?
Fair value $88.96 vs current price $138.02
Wall Street consensus is the average analyst price target: $230.24 (158.8% higher than our fair-value estimate).
Our most-likely fair value is $88.96 a share — about 35.5% away from today's price of $138.02, so the stock currently looks fairly priced.
Is it drowning in debt?
Distressed
Net debt $96.3B. Interest coverage 2.6x.
Net debt
$96.31B
Interest coverage
2.64x
Charter Communications, Inc.'s profit covers its interest bill about 2.6 times over. which is weaker than most peers shown here.
Distressed
Worse cushion
Baseline
Better cushion
CHTR
BASELINE
Charter Communications, Inc.
Total debt $96.82B Interest coverage 2.64x This is the baseline the peer rows are being compared against.
Total debt $94.61B Interest coverage 4.69x +77% vs CHTR Carries about 1.8x more debt cushion than CHTR.
Total debt $159.75B Interest coverage 3.67x +39% vs CHTR Carries about 1.4x more debt cushion than CHTR.
Total debt $200.92B Interest coverage 4.37x +65% vs CHTR Carries about 1.7x more debt cushion than CHTR.
Total debt $122.13B Interest coverage 4.92x +86% vs CHTR Carries about 1.9x more debt cushion than CHTR.
What you should know
The case for and against CHTR
3 Rewards
0 Risks
Rewards
-
Returns 27.5% on equity, ahead of 80% of its peers.
-
Free cash flow was positive in 10/10 years.
-
Trades at 3.7x P/E vs peer median 8.7x (57.3% cheaper).
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
3.73x
Forward P/E
3.12x
P/B
1.04x
P/S
0.40x
EV/EBITDA
5.35x
PEG ratio
0.26x
Profitability
How much profit each dollar creates
Gross margin
55.3%
Operating margin
23.9%
Net margin
9.0%
ROE
27.5%
ROA
5.4%
Health
Liquidity and balance-sheet strength
Debt / equity
4.60x
Current ratio
0.40x
Quick ratio
0.33x
Total debt
$96.82B
Total cash
$517.00M
Growth
How the business has been compounding
Revenue TTM
$54.64B
Revenue 5Y CAGR
1.5%
EPS TTM
36.96
EPS 5Y CAGR
5.6%
Cash flow
How much cash the business throws off
Operating CF TTM
$16.14B
Free CF TTM
$4.42B
FCF margin
8.1%
Dividend
Shareholder payout
Yield
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Payout ratio
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Last ex-div date
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