|
| Wednesday, July 05, 2006 |
Citigroup Bullish on Charter Communications, Upgrades Stock on Management Team Actions
NEW YORK -- Shares of cable television system operator Charter Communications Inc. rose more than 7 percent in Wednesday morning trading, after Citigroup analyst Jason Bazinet upgraded the stock to "Buy from "Sell," saying Charter is poised for a turnaround.
Shares of the company rose 8 cents, or 7.2 percent, to $1.19 on heavy volume.
In a note to clients Wednesday, Bazinet said he expects the company to reverse three flat years of EBITDA, or earnings before interest, taxes, depreciation and amortization, as it rolls out voice-over-Internet Protocol services, or VoIP. The service allows customers to make telephone calls using a broadband Internet connection instead of a regular phone line.
The analyst said fellow competitors, Cablevision System Corp. and Time Warner Inc., experienced a sharp acceleration in EBITDA growth following their deployment of voice services.
Bazinet also said the company's management team has a "clear, well-defined strategy for turning Charter around." Neil Smit, Charter's chief executive officer, plans to invest capital in areas with high return and use fact-based marketing techniques to target the right customers, Bazinet said.
Bazinet upgraded the stock to "Buy" from "Sell," and raised his price target to $1.75 from $1.
On Monday, Charter completed the sale of several of its assets to Cebridge Acquisition Co. and New Wave Communications for a total of about $896 million. |
|
|
|
