Charter: Even Balance Of Risk And Reward Has Me Moving To The Sidelines

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About: Charter Communications, Inc. (CHTR), Includes: T, TMUS, VZ
by: Max Greve
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Max Greve
Tech, telecom, Media, energy
Summary

Charter's results have been strong lately, with mobile revenues per user rising sharply and capital efficiency substantially increasing.

I am shifting from Bearish to Neutral. I am still not bullish, because of three countervailing factors.

Mobile revenue growth may be temporary. It appears to be based on features which would be easy to replicate.

After a few years' delay, there may be new life to my (admittedly premature) theory that cable-box revenues will decline drastically.

Even if not, Charter's high P/E ratio means much of the upside is already baked in.

Right after I finished the article on Altice (ATUS) that I just wrote, one of my regulars pointed out to me that I sounded less bearish on Altice than I had on Charter