CHTR

Based on the comprehensive analysis, Charter Communications (CHTR) presents a challenging case that currently leans cautious. The stock is technically battered, trading near 52-week lows with severe underperformance, though this may signal a potential capitulation point. Fundamentally, while revenue remains robust and cash flow generation is healthy, the extremely high debt load, narrowing profit margins, and intense competitive pressures in the cable industry are significant structural concerns. The valuation is a mixed picture—low P/E ratios suggest deep value, but this is offset by negative earnings growth expectations and a high EV/EBITDA, indicating the market is skeptical of its future profitability.

Recommendation: HOLD, NOT A BUY. While the current price appears deeply oversold and could see a technical bounce, the fundamental headwinds are substantial. The massive debt burden and competitive pressures create a risky profile that outweighs the apparent valuation discount. Investors should wait for clearer signs of stabilizing profitability and a deleveraging strategy before considering a position.

RockFlow Model Forecast: Three Scenarios for 2026

Based on the comprehensive analysis provided, here is a 12-month outlook for Charter Communications (CHTR):

The primary catalyst for any price recovery is the deeply oversold technical condition, which could lead to a significant bounce from capitulation levels, potentially driven by any positive surprises in subscriber trends or cost management. Key risks remain substantial, dominated by the company's massive debt burden, intense competitive pressure from fiber and fixed wireless providers squeezing margins, and a lack of visible earnings growth. Without a clear analyst target, the outlook is cautious; while a technical rally into the $220-$250 range is possible, the fundamental headwinds suggest the stock will likely struggle to sustain significant gains, making a period of volatile, range-bound trading the most probable scenario over the next year.

Wall Street Consensus

Most Wall Street analysts are optimistic about CHTR's 12-month outlook, with consensus target around $202.34, indicating expected upside potential.

Overall, CHTR has investment potential but also faces challenges. Here are key factors to weigh before investing.

CHTR has experienced severe underperformance with a substantial price decline over the past year, currently trading near its 52-week low.

Short-term metrics are decidedly bearish, with the stock falling 6.68% over one month and 25.32% over three months. This performance has significantly lagged the broader market, underperforming by 28.69% over the three-month period, indicating pronounced weakness.

The current price of $197.89 is extremely close to its 52-week low of $193, placing it in deeply oversold territory. With a maximum drawdown of -54.54% from its high, the stock has experienced a severe correction and appears to be stabilizing at a potentially capitulatory level.

Revenue & Profitability CHTR's Q3 2025 revenue of $13.67B shows a slight sequential decline from Q2's $13.77B, while net profit margin compressed from 9.45% to 8.32%. The company maintains solid operating fundamentals with a 46.2% gross margin, though higher interest expenses are pressuring bottom-line results.

Financial Health The company carries significant leverage with a debt-to-equity ratio of 6.24 and debt ratio of 62.6%, indicating a highly leveraged capital structure. Cash flow coverage remains adequate with an interest coverage ratio of 2.56, but the low cash ratio of 0.036 suggests limited liquidity cushion against its substantial debt obligations.

Operational Efficiency CHTR demonstrates moderate operational efficiency with a 7.4% ROE, though asset turnover remains low at 0.089 reflecting the capital-intensive nature of the business. The company generates healthy operating cash flow with $33.49 per share, supporting ongoing operations despite the modest returns on its asset base.

Valuation Level

CHTR appears undervalued based on its valuation metrics. The stock trades at a very low TTM PE of 6.34 and a forward PE of 8.09, which are significantly below typical market levels, suggesting it is cheap on an earnings basis. Furthermore, its low PS ratio of 0.65 and PB ratio of 1.37 indicate the market is valuing its sales and book equity modestly. However, the negative PEG ratio of -0.84 signals negative earnings growth expectations, and the high EV/EBITDA of 25.58 indicates its enterprise value is expensive relative to its operating cash flow, creating a conflicting valuation picture.

Peer Comparison

A direct peer comparison cannot be conducted as specific industry average data was not provided in the request. Generally, comparing these metrics to sector benchmarks for Media/Cable companies would be essential to determine relative valuation. Based on the absolute metrics alone, CHTR's low earnings multiples suggest potential undervaluation, but this assessment is incomplete without the context of its industry peers' average valuation levels.

Of course. Here is a risk analysis for CHTR:

1. Volatility Risk The stock demonstrates higher volatility than the broader market, as indicated by its Beta above 1. This suggests it is likely to experience more pronounced price swings. This characteristic is further evidenced by a significant maximum drawdown of -54.54% over the past year, indicating substantial downside risk and potential for severe capital depreciation during market downturns.

2. Other Risks The absence of reported short interest data is noted; however, this does not inherently signal low risk. Primary concerns for a company like CHTR are likely tied to its substantial debt load, intense competition in the telecommunications sector, and heavy capital expenditure requirements for network maintenance and expansion. Furthermore, while not quantified here, liquidity risk could be a factor for such a high-priced stock, potentially leading to wider bid-ask spreads and challenging entry/exit points for investors.