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The stock is bouncing. The fundamentals? Less so.
Charter shares jumped about 5% on Monday, which is nice if you own the name and less thrilling if you’re trying to explain the business model to your future self. RBC’s Jonathan Atkin kept a neutral-ish Sector Perform rating, but cut his price target to $150 from $160 and trimmed estimates across the board.
What’s the hang-up? Charter is still bleeding broadband subs, and not in the cute, manageable way companies hope for. The company lost 172,000 broadband customers in Q2, worse than Wall Street expected, while broadband ARPU fell 1.7% year over year and free cash flow of $1 billion came in light.
The pain points aren’t exactly subtle
Atkin’s thesis is basically: this isn’t a one-quarter hiccup, it’s a marathon of annoying stuff.
- Broadband subscriber losses are still rolling in
- ARPU is slipping
- Cost inflation is nibbling at margins
- The company may need a bigger cost-cutting program, not just a few efficiency tweaks
He also lowered RBC’s revenue, EBITDA, and free cash flow estimates for 2026 and 2027, which is analyst-speak for: “I’m dialing back the optimism.”
The Cox deal is the wild card
One thing investors are watching like it’s the season finale: Charter’s expected Cox Communications deal. Atkin expects it to close in mid- to late August, and thinks that could kick off a broader transformation program. Charter also remains tied to its mobile strategy through partnerships with Verizon and T-Mobile.
Big picture: the stock can bounce on hope, but analysts still see a business that’s getting squeezed from multiple sides. If Charter wants a real rerating, it probably needs more than a good trading day and a nicer chart.