Charter Communications (NASDAQ:CHTR), a telecom leader, is a little less of a leader than it was even a few days ago. It announced that it was expecting a decline in subscribers, which was the last thing investors wanted to hear. So they cashed out and ran for greener pastures, leaving Charter down over 9% in the closing minutes of Tuesday’s trading session.
Charter projected that it would likely see a loss in its net subscriber rate for broadband internet access in the fourth quarter, and no one took that well. While at an investor conference with UBS, Charter’s chief financial officer, Jessica Fischer, noted that overall additions were slow in November and about as slow as what was seen in October. That suggests a path of overall decline that may lead to a net loss after the quarter is complete. However, Fischer also noted that the “long-term trajectory” for broadband was looking up, even though Fischer acknowledged that the short-term path wasn’t so rosy.
A Strange Time for Losses
Here’s what’s particularly interesting about these projections – they come at a time when Charter should be adding numbers at a higher pace. Charter recently announced plans to invest $1.3 billion in Texas, which would help it “…deliver symmetrical and multi-gigabit speeds across the state.” Further, it would also help fund “…rural broadband expansion for unserved and underserved markets in Texas.” That comes at the right time, too, as Starlink and Amazon’s (NASDAQ:AMZN) upcoming Project Kuiper are set to provide many more options for rural broadband in short order.
Is Charter Communications a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on CHTR stock based on seven Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 2.04% loss in its share price over the past year, the average CHTR price target of $475.67 per share implies 30.74% upside potential.
