Bear Of The Day: Charter Communications (CHTR)
Charter Communications (CHTR) is a Zacks Rank #5 (Strong Sell) after recently missing the Zacks Consensus Estimate. The stock has a Zacks Style Score for Value of A and a C for Growth. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) as it is the Bear of the Day.
Description
Charter Communications, Inc. engages in providing broadband communications services. Its services include Spectrum TV, Spectrum Internet, and Spectrum Voice. It offers business-to-business Internet access, data networking, business telephone, video and music entertainment services, and wireless backhaul. Its advertising sales division, Spectrum Reach, offers local, regional, and national businesses the opportunity to advertise in individual and multiple service areas on cable television networks and advanced advertising platforms. The company was founded in 1993 and is headquartered in Stamford, CT.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of Charter Communications (CHTR) I see the company has beaten the Zacks Consensus Estimate in one of the last four quarters. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
The most recent quarter saw the company report EPS of $8.34 when the consensus was calling for $9.32.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For Charter Communications (CHTR) I see annual estimates for next year moving lower of late.
The current fiscal year consensus number has improved from $36.73 to $36.75over the last 60 days.
The next fiscal year has moved from $43.16 to $43.00 over the last 60 days.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a lot of stocks in the Zacks universe are seeing negative earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
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Charter Communications, Inc. (CHTR): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
