Intrinsic value of Charter Communications - CHTR

Previous Close

$329.99

  Intrinsic Value

$215.08

stock screener

  Rating & Target

sell

-35%

Previous close

$329.99

 
Intrinsic value

$215.08

 
Up/down potential

-35%

 
Rating

sell

We calculate the intrinsic value of CHTR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 78.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  4.80
  4.82
  4.84
  4.85
  4.87
  4.88
  4.89
  4.90
  4.91
  4.92
  4.93
  4.94
  4.94
  4.95
  4.95
  4.96
  4.96
  4.97
  4.97
  4.97
  4.98
  4.98
  4.98
  4.98
  4.98
  4.99
  4.99
  4.99
  4.99
  4.99
Revenue, $m
  43,577
  45,677
  47,887
  50,212
  52,656
  55,227
  57,930
  60,771
  63,757
  66,895
  70,194
  73,659
  77,301
  81,126
  85,145
  89,368
  93,803
  98,462
  103,355
  108,495
  113,894
  119,563
  125,518
  131,772
  138,339
  145,236
  152,479
  160,085
  168,073
  176,461
Variable operating expenses, $m
  38,366
  40,016
  41,751
  43,576
  45,495
  47,514
  49,636
  51,867
  54,211
  56,676
  55,115
  57,836
  60,695
  63,699
  66,855
  70,170
  73,652
  77,310
  81,153
  85,189
  89,427
  93,879
  98,554
  103,465
  108,621
  114,037
  119,724
  125,696
  131,968
  138,554
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  38,366
  40,016
  41,751
  43,576
  45,495
  47,514
  49,636
  51,867
  54,211
  56,676
  55,115
  57,836
  60,695
  63,699
  66,855
  70,170
  73,652
  77,310
  81,153
  85,189
  89,427
  93,879
  98,554
  103,465
  108,621
  114,037
  119,724
  125,696
  131,968
  138,554
Operating income, $m
  5,211
  5,662
  6,136
  6,636
  7,161
  7,713
  8,294
  8,904
  9,546
  10,220
  15,079
  15,823
  16,605
  17,427
  18,291
  19,198
  20,150
  21,151
  22,202
  23,307
  24,466
  25,684
  26,963
  28,307
  29,718
  31,199
  32,755
  34,389
  36,105
  37,907
EBITDA, $m
  17,344
  18,180
  19,060
  19,985
  20,958
  21,981
  23,057
  24,187
  25,376
  26,625
  27,938
  29,317
  30,767
  32,289
  33,889
  35,569
  37,335
  39,189
  41,137
  43,182
  45,331
  47,588
  49,958
  52,447
  55,061
  57,806
  60,689
  63,716
  66,895
  70,233
Interest expense (income), $m
  0
  3,792
  4,059
  4,352
  4,660
  4,984
  5,324
  5,683
  6,059
  6,455
  6,871
  7,309
  7,768
  8,251
  8,759
  9,292
  9,852
  10,441
  11,059
  11,708
  12,390
  13,107
  13,859
  14,649
  15,479
  16,351
  17,266
  18,227
  19,237
  20,297
  21,410
Earnings before tax, $m
  1,418
  1,603
  1,785
  1,976
  2,177
  2,389
  2,611
  2,845
  3,090
  3,348
  7,770
  8,055
  8,354
  8,668
  8,999
  9,345
  9,710
  10,092
  10,494
  10,916
  11,360
  11,825
  12,314
  12,828
  13,367
  13,933
  14,528
  15,152
  15,808
  16,497
Tax expense, $m
  383
  433
  482
  534
  588
  645
  705
  768
  834
  904
  2,098
  2,175
  2,256
  2,340
  2,430
  2,523
  2,622
  2,725
  2,833
  2,947
  3,067
  3,193
  3,325
  3,463
  3,609
  3,762
  3,922
  4,091
  4,268
  4,454
Net income, $m
  1,035
  1,170
  1,303
  1,443
  1,590
  1,744
  1,906
  2,077
  2,256
  2,444
  5,672
  5,880
  6,098
  6,328
  6,569
  6,822
  7,088
  7,367
  7,661
  7,969
  8,293
  8,632
  8,989
  9,364
  9,758
  10,171
  10,605
  11,061
  11,540
  12,042

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  153,440
  160,836
  168,617
  176,802
  185,410
  194,461
  203,978
  213,982
  224,496
  235,547
  247,160
  259,363
  272,185
  285,656
  299,808
  314,675
  330,292
  346,696
  363,927
  382,025
  401,033
  420,997
  441,964
  463,984
  487,109
  511,395
  536,899
  563,681
  591,806
  621,341
Adjusted assets (=assets-cash), $m
  153,440
  160,836
  168,617
  176,802
  185,410
  194,461
  203,978
  213,982
  224,496
  235,547
  247,160
  259,363
  272,185
  285,656
  299,808
  314,675
  330,292
  346,696
  363,927
  382,025
  401,033
  420,997
  441,964
  463,984
  487,109
  511,395
  536,899
  563,681
  591,806
  621,341
Revenue / Adjusted assets
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
  0.284
Average production assets, $m
  57,478
  60,248
  63,163
  66,229
  69,454
  72,844
  76,409
  80,157
  84,095
  88,235
  92,585
  97,156
  101,959
  107,006
  112,307
  117,876
  123,726
  129,871
  136,326
  143,105
  150,226
  157,704
  165,558
  173,807
  182,469
  191,567
  201,120
  211,153
  221,688
  232,752
Working capital, $m
  -7,452
  -7,811
  -8,189
  -8,586
  -9,004
  -9,444
  -9,906
  -10,392
  -10,902
  -11,439
  -12,003
  -12,596
  -13,218
  -13,873
  -14,560
  -15,282
  -16,040
  -16,837
  -17,674
  -18,553
  -19,476
  -20,445
  -21,464
  -22,533
  -23,656
  -24,835
  -26,074
  -27,375
  -28,740
  -30,175
Total debt, $m
  75,163
  80,584
  86,288
  92,288
  98,597
  105,232
  112,208
  119,540
  127,248
  135,348
  143,861
  152,805
  162,204
  172,078
  182,451
  193,349
  204,796
  216,820
  229,451
  242,716
  256,650
  271,283
  286,652
  302,792
  319,743
  337,544
  356,239
  375,870
  396,486
  418,135
Total liabilities, $m
  112,471
  117,892
  123,596
  129,596
  135,905
  142,540
  149,516
  156,848
  164,556
  172,656
  181,169
  190,113
  199,512
  209,386
  219,759
  230,657
  242,104
  254,128
  266,759
  280,024
  293,958
  308,591
  323,960
  340,100
  357,051
  374,852
  393,547
  413,178
  433,794
  455,443
Total equity, $m
  40,968
  42,943
  45,021
  47,206
  49,504
  51,921
  54,462
  57,133
  59,941
  62,891
  65,992
  69,250
  72,673
  76,270
  80,049
  84,018
  88,188
  92,568
  97,169
  102,001
  107,076
  112,406
  118,004
  123,884
  130,058
  136,542
  143,352
  150,503
  158,012
  165,898
Total liabilities and equity, $m
  153,439
  160,835
  168,617
  176,802
  185,409
  194,461
  203,978
  213,981
  224,497
  235,547
  247,161
  259,363
  272,185
  285,656
  299,808
  314,675
  330,292
  346,696
  363,928
  382,025
  401,034
  420,997
  441,964
  463,984
  487,109
  511,394
  536,899
  563,681
  591,806
  621,341
Debt-to-equity ratio
  1.830
  1.880
  1.920
  1.950
  1.990
  2.030
  2.060
  2.090
  2.120
  2.150
  2.180
  2.210
  2.230
  2.260
  2.280
  2.300
  2.320
  2.340
  2.360
  2.380
  2.400
  2.410
  2.430
  2.440
  2.460
  2.470
  2.490
  2.500
  2.510
  2.520
Adjusted equity ratio
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,035
  1,170
  1,303
  1,443
  1,590
  1,744
  1,906
  2,077
  2,256
  2,444
  5,672
  5,880
  6,098
  6,328
  6,569
  6,822
  7,088
  7,367
  7,661
  7,969
  8,293
  8,632
  8,989
  9,364
  9,758
  10,171
  10,605
  11,061
  11,540
  12,042
Depreciation, amort., depletion, $m
  12,134
  12,518
  12,923
  13,349
  13,797
  14,268
  14,763
  15,283
  15,830
  16,405
  12,859
  13,494
  14,161
  14,862
  15,598
  16,372
  17,184
  18,038
  18,934
  19,876
  20,865
  21,903
  22,994
  24,140
  25,343
  26,606
  27,933
  29,327
  30,790
  32,327
Funds from operations, $m
  13,169
  13,688
  14,226
  14,792
  15,386
  16,012
  16,669
  17,360
  18,086
  18,850
  18,531
  19,374
  20,259
  21,190
  22,167
  23,194
  24,272
  25,405
  26,595
  27,845
  29,157
  30,536
  31,983
  33,504
  35,101
  36,778
  38,539
  40,388
  42,330
  44,369
Change in working capital, $m
  -341
  -359
  -378
  -397
  -418
  -440
  -462
  -486
  -511
  -537
  -564
  -593
  -623
  -654
  -687
  -722
  -758
  -797
  -837
  -879
  -923
  -970
  -1,018
  -1,069
  -1,123
  -1,179
  -1,239
  -1,301
  -1,366
  -1,434
Cash from operations, $m
  13,510
  14,048
  14,604
  15,189
  15,804
  16,451
  17,131
  17,846
  18,597
  19,386
  19,095
  19,967
  20,882
  21,844
  22,854
  23,916
  25,031
  26,202
  27,432
  28,724
  30,080
  31,505
  33,002
  34,573
  36,224
  37,957
  39,777
  41,689
  43,696
  45,803
Maintenance CAPEX, $m
  -7,615
  -7,983
  -8,368
  -8,773
  -9,199
  -9,646
  -10,117
  -10,612
  -11,133
  -11,680
  -12,255
  -12,859
  -13,494
  -14,161
  -14,862
  -15,598
  -16,372
  -17,184
  -18,038
  -18,934
  -19,876
  -20,865
  -21,903
  -22,994
  -24,140
  -25,343
  -26,606
  -27,933
  -29,327
  -30,790
New CAPEX, $m
  -2,647
  -2,770
  -2,915
  -3,066
  -3,225
  -3,391
  -3,565
  -3,747
  -3,939
  -4,140
  -4,350
  -4,571
  -4,803
  -5,046
  -5,301
  -5,569
  -5,850
  -6,145
  -6,455
  -6,779
  -7,120
  -7,478
  -7,854
  -8,249
  -8,663
  -9,097
  -9,554
  -10,033
  -10,536
  -11,064
Cash from investing activities, $m
  -10,262
  -10,753
  -11,283
  -11,839
  -12,424
  -13,037
  -13,682
  -14,359
  -15,072
  -15,820
  -16,605
  -17,430
  -18,297
  -19,207
  -20,163
  -21,167
  -22,222
  -23,329
  -24,493
  -25,713
  -26,996
  -28,343
  -29,757
  -31,243
  -32,803
  -34,440
  -36,160
  -37,966
  -39,863
  -41,854
Free cash flow, $m
  3,248
  3,294
  3,321
  3,350
  3,381
  3,414
  3,449
  3,486
  3,525
  3,567
  2,490
  2,536
  2,585
  2,637
  2,691
  2,748
  2,809
  2,872
  2,939
  3,010
  3,084
  3,162
  3,244
  3,331
  3,421
  3,517
  3,617
  3,723
  3,833
  3,950
Issuance/(repayment) of debt, $m
  4,932
  5,421
  5,704
  6,000
  6,310
  6,635
  6,976
  7,333
  7,707
  8,100
  8,512
  8,945
  9,398
  9,874
  10,373
  10,897
  11,447
  12,024
  12,630
  13,266
  13,933
  14,634
  15,369
  16,141
  16,951
  17,801
  18,694
  19,632
  20,616
  21,649
Issuance/(repurchase) of shares, $m
  849
  805
  775
  743
  709
  673
  635
  594
  551
  506
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  5,781
  6,226
  6,479
  6,743
  7,019
  7,308
  7,611
  7,927
  8,258
  8,606
  8,512
  8,945
  9,398
  9,874
  10,373
  10,897
  11,447
  12,024
  12,630
  13,266
  13,933
  14,634
  15,369
  16,141
  16,951
  17,801
  18,694
  19,632
  20,616
  21,649
Total cash flow (excl. dividends), $m
  9,029
  9,520
  9,800
  10,093
  10,400
  10,722
  11,059
  11,413
  11,784
  12,173
  11,002
  11,481
  11,983
  12,511
  13,065
  13,646
  14,256
  14,897
  15,570
  16,276
  17,017
  17,796
  18,613
  19,471
  20,372
  21,318
  22,311
  23,354
  24,449
  25,599
Retained Cash Flow (-), $m
  -1,884
  -1,975
  -2,078
  -2,185
  -2,298
  -2,417
  -2,541
  -2,671
  -2,807
  -2,951
  -3,101
  -3,258
  -3,423
  -3,597
  -3,779
  -3,969
  -4,170
  -4,380
  -4,601
  -4,832
  -5,075
  -5,330
  -5,598
  -5,879
  -6,174
  -6,484
  -6,809
  -7,151
  -7,509
  -7,886
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  7,145
  7,545
  7,722
  7,907
  8,102
  8,305
  8,518
  8,742
  8,977
  9,223
  7,902
  8,223
  8,560
  8,914
  9,286
  9,676
  10,086
  10,517
  10,969
  11,444
  11,942
  12,465
  13,015
  13,592
  14,198
  14,834
  15,502
  16,203
  16,940
  17,713
Discount rate, %
  9.20
  9.66
  10.14
  10.65
  11.18
  11.74
  12.33
  12.95
  13.59
  14.27
  14.99
  15.74
  16.52
  17.35
  18.22
  19.13
  20.08
  21.09
  22.14
  23.25
  24.41
  25.63
  26.91
  28.26
  29.67
  31.15
  32.71
  34.35
  36.07
  37.87
PV of cash for distribution, $m
  6,543
  6,274
  5,779
  5,275
  4,769
  4,266
  3,775
  3,301
  2,851
  2,429
  1,701
  1,424
  1,173
  949
  755
  588
  449
  336
  245
  175
  122
  82
  54
  35
  21
  13
  7
  4
  2
  1
Current shareholders' claim on cash, %
  98.9
  98.0
  97.1
  96.3
  95.6
  94.9
  94.4
  93.9
  93.4
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0
  93.0

Charter Communications, Inc., through its subsidiaries, provides cable services to residential and commercial customers in the United States. It offers subscription-based video services, including a package of basic video programming, video on demand, high definition television, digital video recorder, pay-per-view, and Spectrum guide services, as well as ad-supported free online video products. The company also provides Internet services, such as security suite that protects computers from viruses and spyware; in-home WiFi, which permits customers to lease high performance wireless routers to enhance their in-home wireless Internet experience; out-of-home WiFi; parental control features; and residential Internet services. In addition, it offers voice communications services using voice over Internet protocol technology; and broadband communications solutions, such as Internet access, data networking, fiber connectivity, video entertainment, and business telephone services to cellular towers and office buildings for business and carrier organizations. Further, the company provides video programming and music, Web hosting, e-mail and security, and multi-line telephone services, as well as Web-based service management; and sells video and online advertising inventory to local, regional, and national advertising customers. Additionally, it offers fiber-delivered communications and managed information technology solutions; and security and home management services, as well as owns and operates regional sports networks and local sports, news, and lifestyle channels. As of December 31, 2016, the company served approximately 26.2 million residential and business customers. Charter Communications, Inc. was founded in 1999 and is headquartered in Stamford, Connecticut.

FINANCIAL RATIOS  of  Charter Communications (CHTR)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. 0%
Return On Total Capital 0%
Ret/ On T. Cap. - 3 Yr. Avg. 0%
Return On Equity 0%
Return On Equity - 3 Yr. Avg. 0%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

CHTR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CHTR stock intrinsic value calculation we used $41581 million for the last fiscal year's total revenue generated by Charter Communications. The default revenue input number comes from 0001 income statement of Charter Communications. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our CHTR stock valuation model: a) initial revenue growth rate of 4.8% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 9.2%, whose default value for CHTR is calculated based on our internal credit rating of Charter Communications, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Charter Communications.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of CHTR stock the variable cost ratio is equal to 88.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for CHTR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Charter Communications.

Corporate tax rate of 27% is the nominal tax rate for Charter Communications. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the CHTR stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for CHTR are equal to 131.9%.

Life of production assets of 7.2 years is the average useful life of capital assets used in Charter Communications operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for CHTR is equal to -17.1%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $39084 million for Charter Communications - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 237.463 million for Charter Communications is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Charter Communications at the current share price and the inputted number of shares is $78.4 billion.

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COMPANY NEWS

▶ This $180M mixed-use development leads the way for growth around SunRail   [Sep-20-18 03:29PM  American City Business Journals]
▶ This $180M mixed-use development leads the way for growth around SunRail   [Sep-19-18 03:50PM  American City Business Journals]
▶ Spectrum looking at dozen local leases as it overhauls retail experience   [Sep-18-18 12:37PM  American City Business Journals]
▶ 3 Reasons to Love Charter Communications   [Sep-14-18 08:15AM  Motley Fool]
▶ Charter Communications launches cell-phone service in Louisville   [07:15AM  American City Business Journals]
▶ Spectrum launches mobile phone network in Cincinnati   [Sep-04-18 02:10PM  American City Business Journals]
▶ San Antonio City Council supports state tax refunds for three companies   [Aug-30-18 02:26PM  American City Business Journals]
▶ Charter Communications on Cord-Cutting: No Big Deal   [Aug-25-18 07:04AM  Motley Fool]
▶ Here's What Warren Buffett Has Been Selling   [Aug-22-18 09:14AM  Motley Fool]
▶ Charter Closes $500 Million Senior Secured Notes   [Aug-15-18 09:25PM  PR Newswire]
▶ Warren Buffett ups his stake in Apple   [01:30PM  Yahoo Finance Video]
▶ Charter Prices $500 Million Senior Secured Notes   [Aug-09-18 09:49PM  PR Newswire]
▶ [$$] New Yorks Charter Mugging   [Aug-02-18 07:41PM  The Wall Street Journal]
▶ [$$] New York's Charter Mugging   [07:14PM  The Wall Street Journal]
▶ Charter: 2Q Earnings Snapshot   [Jul-31-18 12:03PM  Associated Press]
▶ [$$] Charter Communications surfs higher on subscriber gains   [Jul-30-18 11:26PM  Financial Times]
▶ Surprise! Cord-Cutting Is Still Growing in Popularity   [Jul-28-18 10:44AM  Motley Fool]
▶ [$$] State Regulator Revokes Approval of Charter, Time Warner Cable Merger   [Jul-27-18 06:26PM  The Wall Street Journal]
▶ Trade Wars: 6 Stocks That Are Leading the Pack   [Jul-26-18 08:00AM  Investopedia]
▶ [$$] John Malone Retires From Charter Communications Board   [Jul-24-18 07:24PM  The Wall Street Journal]
▶ Why Was Charter Communications Up 12% in June?   [Jul-06-18 11:04AM  Motley Fool]
▶ Charter Closes $1.5 Billion Senior Secured Notes   [Jul-03-18 05:50PM  PR Newswire]
▶ Charter Prices $1.5 Billion Senior Secured Notes   [Jun-28-18 06:15PM  PR Newswire]
▶ Charter Offers Senior Secured Notes   [09:03AM  PR Newswire]
▶ Farewell to Net Neutrality: Winners and Losers   [Jun-22-18 12:23PM  InvestorPlace]
▶ 6 Stock Picks of One of Buffett's Favorite Investors   [Jun-18-18 08:00AM  Investopedia]
▶ [$$] Reeling From Netflix, Media Turns to Mergers   [Jun-16-18 12:01AM  Barrons.com]

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