Yahoo Finance Results: Charter Communications, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts
Investors in Charter Communications, Inc. (NASDAQ:CHTR) had a good week, as its shares rose 6.6% to close at US$532 following the release of its full-year results. Revenues were US$46b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$7.45 were also better than expected, beating analyst predictions by 11%. Analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what analysts are expecting for next year.
Check out our latest analysis for Charter Communications
Taking into account the latest results, the most recent consensus for Charter Communications from 29 analysts is for revenues of US$48.1b in 2020, which is a reasonable 5.1% increase on its sales over the past 12 months. Statutory earnings per share are expected to shoot up 80% to US$13.70. Yet prior to the latest earnings, analysts had been forecasting revenues of US$48.1b and earnings per share (EPS) of US$13.39 in 2020. So the consensus seems to have become somewhat more optimistic on Charter Communications's earnings potential following these results.
Analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 7.4% to US$544. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. The most optimistic Charter Communications analyst has a price target of US$635 per share, while the most pessimistic values it at US$365. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Charter Communications's past performance and to peers in the same market. We would highlight that Charter Communications's revenue growth is expected to slow, with forecast 5.1% increase next year well below the historical 31%p.a. growth over the last five years. By way of comparison, other companies in this market with analyst coverage, are forecast to grow their revenue at 3.8% next year. So it's pretty clear that, while Charter Communications's revenue growth is expected to slow, it's still expected to grow faster than the market itself.
The Bottom Line
The most important thing to take away from this is that analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Charter Communications following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Charter Communications's revenues are expected to grow faster than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Charter Communications going out to 2024, and you can see them free on our platform here.
You can also view our analysis of Charter Communications's balance sheet, and whether we think Charter Communications is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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