Charter Communications Inc. (NASDAQ:CHTR)

Return on Assets (ROA)

The ROA exhibits a generally positive trend over the analyzed period. Beginning at 2.23% in 2020, it increased steadily to a peak of 3.5% in 2022. A slight diminishing trend is observed in 2023, with ROA declining to 3.1%, followed by a moderate recovery to 3.39% in 2024. Overall, this pattern suggests improving asset efficiency with minor fluctuations in the most recent years.

Financial Leverage

Financial leverage shows considerable volatility and an overall rising trend between 2020 and 2022. Starting at a ratio of 6.06 in 2020, leverage sharply increased to 10.14 in 2021, then escalated further to a peak of 15.85 in 2022. Subsequently, there is a marked reduction in leverage, dropping to 13.28 in 2023 and further to 9.62 by 2024. This indicates the company initially increased its debt or obligations substantially before engaging in deleveraging activities in the later years.

Return on Equity (ROE)

ROE shows a strong upward momentum through 2022, rising from 13.53% in 2020 to a peak of 55.43% in 2022. This dramatic increase parallels the rising financial leverage, suggesting enhanced equity returns potentially driven by higher leverage. However, in 2023 and 2024, ROE declines to 41.11% and 32.61%, respectively, which may correspond to the deleveraging efforts seen in the leverage ratio, indicating a reduction in equity risk and possibly a more conservative financial position.

Net Profit Margin

The net profit margin showed an overall improving trend from 6.7% in 2020 to 9.23% in 2024. It increased steadily from 2020 through 2022, reaching a peak of 9.36%, then experienced a slight decline to 8.35% in 2023 before rebounding in 2024.

Asset Turnover

The asset turnover ratio demonstrated a gradual increase from 0.33 in 2020 to 0.37 by 2022, after which it remained stable at 0.37 through 2024. This indicates a modest improvement in the efficiency of asset use, which then plateaued in the latter years.

Financial Leverage

Financial leverage exhibited significant fluctuations over the period. It surged sharply from 6.06 in 2020 to a peak of 15.85 in 2022, then declined to 13.28 in 2023 and further to 9.62 in 2024. This pattern suggests an increase in the use of debt financing until 2022, followed by a gradual deleveraging phase.

Return on Equity (ROE)

ROE showed a marked increase from 13.53% in 2020 to 55.43% in 2022, reflecting strong profitability and efficient use of equity during this period. However, ROE declined substantially to 41.11% in 2023 and further to 32.61% in 2024, indicating a moderation in returns to equity holders despite remaining significantly higher than the 2020 level.

Tax Burden

The tax burden ratio exhibited a declining trend from 0.84 in 2020 to 0.74 in 2023, followed by a slight increase to 0.76 in 2024. This indicates a gradual improvement in after-tax profitability up to 2023, with a minor reversal in the latest year.

Interest Burden

The interest burden ratio increased from 0.50 in 2020 to 0.59 in 2021 and remained stable at 0.59 in 2022 before decreasing to 0.54 in 2023 and slightly rising again to 0.56 in 2024. This suggests fluctuating efficiency in managing interest expenses, with better efficiency in 2023 compared to earlier years.

EBIT Margin

The EBIT margin demonstrated a consistent upward trend over the period, rising from 16% in 2020 to 21.71% in 2024. This improvement reflects enhanced operating profitability and effective cost management.

Asset Turnover

Asset turnover increased modestly from 0.33 in 2020 to 0.37 in 2022 and remained steady thereafter through 2024. This stability indicates consistent efficiency in utilizing assets to generate revenues.

Financial Leverage

Financial leverage showed significant volatility, climbing sharply from 6.06 in 2020 to a peak of 15.85 in 2022 before declining to 9.62 by 2024. The elevated leverage ratio in 2022 suggests increased reliance on debt financing, which was subsequently reduced over the following years.

Return on Equity (ROE)

ROE experienced substantial growth from 13.53% in 2020 to a high of 55.43% in 2022, followed by a decline to 32.61% in 2024. This pattern mirrors trends in financial leverage and profitability, where the spike in ROE corresponds with heightened leverage and operating margins, while the later decrease aligns with deleveraging and normalization of returns.

Net Profit Margin

The net profit margin demonstrated an upward trend over the observed period, starting at 6.7% in 2020 and reaching a peak of 9.36% in 2022. Although a slight decline occurred in 2023 to 8.35%, the margin recovered to 9.23% by 2024. This pattern suggests an overall improvement in profitability, with minor fluctuations indicating operational or market challenges in 2023.

Asset Turnover

This ratio showed a gradual increase, moving from 0.33 in 2020 to 0.37 by 2022, after which it stabilized, maintaining the same level through 2024. The initial increase indicates improved efficiency in utilizing assets to generate revenue, while the plateau suggests a consistent but limited capacity for asset-driven revenue growth in recent years.

Return on Assets (ROA)

ROA followed a pattern similar to profitability indicators, rising from 2.23% in 2020 to 3.5% in 2022. A slight decrease occurred in 2023 to 3.1%, followed by a rebound to 3.39% in 2024. These figures reflect an overall enhancement in how effectively the company’s assets generate net income, despite a temporary dip in 2023.

Tax Burden

The tax burden ratio displays a declining trend from 0.84 in 2020 to a low of 0.74 in 2023, followed by a slight increase to 0.76 in 2024. This indicates a gradual reduction in the proportion of earnings paid as taxes over the initial years, easing slightly in the last reported year.

Interest Burden

The interest burden ratio improved from 0.50 in 2020 to 0.59 in both 2021 and 2022, suggesting a reduced proportion of earnings consumed by interest expenses during this period. However, there was a moderate decline to 0.54 in 2023 before a small recovery to 0.56 in 2024. Overall, the interest expense impact has moderately improved compared to 2020.

EBIT Margin

The EBIT margin demonstrates a continuous upward trend, rising from 16% in 2020 to 21.71% in 2024. This steady increase over the five-year span reflects consistent improvements in operational profitability.

Asset Turnover

Asset turnover increased slightly from 0.33 in 2020 to 0.37 in 2022, maintaining that level through 2024. This suggests enhanced efficiency in utilizing assets to generate sales, which stabilized from 2022 onward.

Return on Assets (ROA)

ROA rose from 2.23% in 2020 to a peak of 3.5% in 2022, followed by a dip to 3.1% in 2023 and a recovery to 3.39% in 2024. Despite some fluctuation, the overall trend points to improved asset profitability compared to the starting point.

The financial data reveals several notable trends and shifts over the five-year period. The tax burden ratio has exhibited a downward trend from 0.84 in 2020 to a low of 0.74 in 2023, followed by a slight increase to 0.76 in 2024. This suggests a general improvement in the company’s tax efficiency, although the slight uptick in the latest year indicates some variability.

The interest burden ratio initially increased significantly from 0.50 in 2020 to 0.59 in 2021 and remained stable through 2022. It then decreased to 0.54 in 2023 before rising slightly again to 0.56 in 2024. This pattern indicates fluctuating interest expenses relative to earnings before interest and taxes, with some recent improvement in managing interest costs.

The EBIT margin showed a continuous and consistent increase, moving from 16.00% in 2020 to 21.71% in 2024. This steady growth reflects an improving operational efficiency and profitability before interest and taxes, which is a positive indicator of core business performance.

Net profit margin trends are somewhat more variable. The margin rose significantly from 6.70% in 2020 to a peak of 9.36% in 2022, followed by a decline to 8.35% in 2023, before recovering slightly to 9.23% in 2024. This fluctuation may indicate varying impacts from non-operating expenses or changes in tax and interest burdens, despite the overall upward trajectory compared to the starting point.

Tax Burden

General decline over the period with a slight increase in the last year, indicating improved tax efficiency but some recent variability.

Interest Burden

Initial increase and stabilization followed by reduction and a slight increase, reflecting fluctuating interest expenses but some recent cost control.

EBIT Margin

Consistent upward trend demonstrating ongoing improvement in operating profitability and efficiency.

Net Profit Margin

Significant increase with some volatility in the middle years, suggesting variations in non-operating factors but overall growth in profitability.