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Altice USA Inc Class A ATUS

Morningstar Rating
$2.18 +0.11 (5.31%)
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Company Report

Altice USA Has Made Gradual Improvements but Still Faces Very High Uncertainty

Altice USA has struggled to maintain revenue growth recently—more than cable peers Comcast and Charter—as it battles stiff competition from Verizon in the New York market and faces the broader incursion of fixed-wireless players into the broadband business. The firm has also taken a different approach to the business in recent years than other cable operators, with lackluster results. A new management team, largely hailing from Comcast, has slowly been improving the firm's performance. We expect the firm’s networks will remain vital pieces of infrastructure that will generate strong, albeit slow-growing, cash flow over the long term. However, Altice USA also carries a very large debt load, leaving it little room for error.

Price vs Fair Value

ATUS is trading within a range we consider fairly valued.
Price
$2.18
Fair Value
$3.00
Uncertainty
Very High
1-Star Price
$33.63
5-Star Price
$3.80
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Altice USA's effort to deploy fiber put the firm on a path to future-proof its networks over the next few years.

Bears

Stiff competition in New York, which accounts for about 60% of Altice USA’s business, will limit revenue growth. The firm has been forced to invest heavily in this network to catch up with Verizon.

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News

Trading Information

Previous Close Price
$2.07
Day Range
$2.032.20
52-Week Range
$1.753.82
Bid/Ask
$2.15 / $2.26
Market Cap
$1.00 Bil
Volume/Avg
2.8 Mil / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
7.33
Price/Sales
0.11
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield

Company Profile

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 4 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 5.5 million homes and business in the New York City metro area. Both regions now operate under the Optimum brand name. 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 news in New York and i24News, a news operation focused on the Middle East.
Sector
Communication Services
Industry
Telecom Services
Stock Style Box
Small Value
Total Number of Employees
10,600

Competitors

Valuation

Metric
ATUS
LUMN
VZ
Price/Earnings (Normalized)
7.3321.098.64
Price/Book Value
2.161.80
Price/Sales
0.110.071.27
Price/Cash Flow
0.500.384.43
Price/Earnings
ATUS
LUMN
VZ

Financial Strength

Metric
ATUS
LUMN
VZ
Quick Ratio
0.270.770.52
Current Ratio
0.411.030.71
Interest Coverage
1.03−8.333.72
Quick Ratio
ATUS
LUMN
VZ

Profitability

Metric
ATUS
LUMN
VZ
Return on Assets (Normalized)
0.64%−0.98%4.66%
Return on Equity (Normalized)
−11.06%18.99%
Return on Invested Capital (Normalized)
5.85%3.01%7.89%
Return on Assets
ATUS
LUMN
VZ
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