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Altice USA Inc Class A ATUS

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Morningstar’s Analysis

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Altice USA Posts Choppy Q3 Results; Shares Modestly Undervalued

Analyst Note

| Michael Hodel, CFA |

Altice USA posted a small (0.2%) year-over-year revenue decline during the third quarter, as accruals for rebates of regional sports network fees and credits for storm outages weighed on otherwise solid results. Continued cost control efforts produced improved profitability, despite investments to grow the wireless business. Altice also reported encouraging early results from its fiber-to-the-home initiative in the New York market, with 44% of new customers in eligible areas taking fiber service. We don’t plan to change our $30 fair value estimate, leaving the shares modestly undervalued.

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Company Profile

Business Description

Altice Europe acquired privately held U.S. cable company Suddenlink in 2015 and Cablevision in 2016. Suddenlink’s networks provide television, Internet access, and phone services to roughly 3.5 million U.S. homes and businesses located primarily in smaller markets, with major clusters in Texas, West Virginia, Idaho, Arizona, and Louisiana. Cablevision provides comparable services to about 5.2 million homes and business exclusively in the New York City metro area. Altice Europe spun off Altice USA, which includes both the Suddenlink and Cablevision operations, to shareholders in 2018. Altice USA also owns News 12 Networks, which broadcasts local 24-hour news networks in New York, i24News, a news operation focused on the Middle East and Israel, and Cheddar, a news upstart.

Contact
1 Court Square West, Long Island City
New York, NY, 11101
T +1 516 803-2300
Sector Communication Services
Industry Telecom Services
Most Recent Earnings Sep 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type Slow Growth
Employees 10,700