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Investing.com - UBS has lowered its price target on Charter Communications (NASDAQ:CHTR) to $355.00 from $425.00 while maintaining a Neutral rating, citing weaker-than-expected second quarter results. According to InvestingPro data, the stock is currently trading near its 52-week low, though analysis suggests it remains undervalued at current levels.
The cable provider, which generates annual revenue of $55.22 billion and maintains a healthy EBITDA of $22.18 billion, reported revenue growth of 0.6% year-over-year in the second quarter, while EBITDA declined 0.1% excluding certain items, compared to 4.8% growth in the first quarter. Residential revenues fell 0.4% during the period.
Charter attributed broadband subscriber declines to higher non-pay churn among former Affordable Connectivity Program customers, despite higher new connects and lower voluntary churn. UBS expects competitive pressures to persist in the broadband market.
The firm revised its forecasts, now projecting -0.5% revenue growth and +0.3% EBITDA growth for the third quarter. For the full year, UBS expects -0.1% revenue growth and 1.1% EBITDA growth, down from previous estimates of flat revenue and 2.0% EBITDA growth.
UBS also noted that Charter will benefit from lower cash taxes following recent legislation, creating approximately a $1 billion tailwind in 2026, which should support capital expenditure plans and share buybacks estimated at $1.6 billion per quarter over the next twelve months.
In other recent news, Charter Communications reported its second-quarter earnings for 2025, which revealed an earnings per share (EPS) of $9.18, falling short of the forecasted $9.58. However, the company’s revenue met expectations, coming in at $13.77 billion and showing slight year-over-year growth. Despite these results, the company’s stock experienced a decline, reflecting investor concerns regarding the earnings miss. In a separate development, Bernstein SocGen upgraded Charter Communications from Market Perform to Outperform, although it lowered the price target from $410.00 to $380.00. This upgrade comes amidst ongoing challenges in the broadband sector, where Charter lost 111,000 residential broadband subscribers in the second quarter of 2025. Bernstein SocGen noted these subscriber losses were consistent with the previous year when adjusted for non-voluntary disconnects. These recent developments highlight the mixed signals investors are receiving about Charter Communications’ current performance and future prospects.
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