Charter Communications (CHTR), the over-leveraged cable company, is down 21% today to $1.41, a new 52-week low. Not that long ago, the stock traded at $4.93.
Wall St. does not like cable companies right now. Even mega-cable company Comcast (CMCSA) is near a 52-week low. There is too much concern that satellite TV high-definition and telecom fiber-to-the-home products will steal cable subscribers.
But, Charter is much weaker than most other cable operators. It carries $19 billion in debt. At its current stock price, the company has a market cap of only $550 million.
Today Charter reported third-quarter pro forma revenues of $1.526 billion grew 11.2% year over year and actual revenue grew 9.9%, driven by significant increases in telephone and high-speed Internet revenues.
Digital video customers increased by only 15,800 in the quarter. Analog video customers decreased by approximately 40,200. Not a very good balance.
But, investors are looking beyond subscriber counts and pro forma numbers. Operating income from continuing operations increased to $107 million in the third quarter of 2007 from $66 million in the third quarter of 2006 and the net loss for the third quarter of 2007 was $407 million, or $1.10 per common share. For the third quarter of 2006, Charter reported a net loss of $133 million and loss per common share of $0.41.
The number that scares shareholder is the $453 million in interest expense. That is an awful lot for a company that reported only $210 million in cash flow.
Charter is in real trouble now. Billionaire Paul Allen controls the company. And it is going to cost him some real dough to get out of this.
Douglas A. McIntyre
The Average American Has No Idea How Much Money You Can Make Today (Sponsor)
The last few years made people forget how much banks and CD’s can pay. Meanwhile, interest rates have spiked and many can afford to pay you much more, but most are keeping yields low and hoping you won’t notice.
But there is good news. To win qualified customers, some accounts are paying almost 10x the national average! That’s an incredible way to keep your money safe and earn more at the same time. Our top pick for high yield savings accounts includes other benefits as well. You can earn up to 3.80% with a Checking & Savings Account today Sign up and get up to $300 with direct deposit. No account fees. FDIC Insured.
Click here to see how much more you could be earning on your savings today. It takes just a few minutes to open an account to make your money work for you.
Our top pick for high yield savings accounts includes other benefits as well. You can earn up to 4.00% with a Checking & Savings Account from Sofi. Sign up and get up to $300 with direct deposit. No account fees. FDIC Insured.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.