With shares of Time Warner Cable (NYSE:TWC) trading around $133, is TWC an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
T = Trends for a Stock’s Movement
Time Warner Cable is a provider of video, high-speed data, and voice services in the United States, with systems located in five geographic areas: New York, the Carolinas, Ohio, Southern California, and Texas. The company offers its residential and business services customers numerous services over its broadband cable systems. With such a large and growing user base, look for Time Warner Cable to continue to see rising profits from its media, entertainment, and communications offerings.
Time Warner Cable lost 215,000 video subscribers in the fourth quarter amid competition with phone carriers and the challenge of convincing younger consumers to pay for TV. The defections brought Time Warner Cable’s customer losses for the year to about 825,000, up from 530,000 in 2012. The company added 55,000 high-speed Internet subscribers and 15,000 phone users in the fourth quarter, Chief Financial Officer Artie Minson said at an investor conference. The mounting competition for video viewers has made Time Warner Cable a potential takeover target for Charter Communications Inc. and other cable carriers looking to gain size in the industry. New York-based Time Warner Cable is the second-largest U.S. cable provider, trailing only Comcast (NASDAQ:CMCSA) Charter may unveil a $62 billion bid for Time Warner Cable as soon as this week, people with knowledge of the matter have said. The company may face competition from Comcast and Cox Communications Inc. to acquire the carrier.