Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
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- Balance Sheet: Assets
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value to EBITDA (EV/EBITDA)
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2010
- Return on Equity (ROE) since 2010
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Current Valuation Ratios
Charter Communications Inc., current price multiples
| Charter Communications Inc. | Alphabet Inc. | Comcast Corp. | Meta Platforms Inc. | Netflix Inc. | Take-Two Interactive Software Inc. | Walt Disney Co. | Media & Entertainment | Communication Services | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||
| Current share price (P) | ||||||||||||
| No. shares of common stock outstanding | ||||||||||||
| Growth rate (g) | ||||||||||||
| Earnings per share (EPS) | ||||||||||||
| Next year expected EPS | ||||||||||||
| Operating profit per share | ||||||||||||
| Sales per share | ||||||||||||
| Book value per share (BVPS) | ||||||||||||
| Valuation Ratios (Price Multiples) | ||||||||||||
| Price to earnings (P/E) | ||||||||||||
| Price to next year expected earnings | ||||||||||||
| Price-earnings-growth (PEG) | ||||||||||||
| Price to operating profit (P/OP) | ||||||||||||
| Price to sales (P/S) | ||||||||||||
| Price to book value (P/BV) | ||||||||||||
Based on: 10-K (reporting date: 2023-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Charter Communications Inc., historical price multiples
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Price to earnings (P/E) | ||||||
| Price to operating profit (P/OP) | ||||||
| Price to sales (P/S) | ||||||
| Price to book value (P/BV) |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
- Price to Earnings (P/E) Ratio
- The Price to Earnings ratio exhibits a marked downward trend over the five-year span. Beginning at a high of 65.14 in 2019, the ratio steadily decreases each year, reaching 10.17 by the end of 2023. This substantial decline suggests a growing market confidence in earnings or a correction from previously elevated valuation levels.
- Price to Operating Profit (P/OP) Ratio
- A similar decreasing trend is observed in the Price to Operating Profit ratio. Starting from 16.69 in 2019, it moderately declines to 14 in 2020, with sharper drops in subsequent years culminating at 3.69 in 2023. This consistent reduction signifies an improving relationship between the stock price and the operating profit, indicating enhanced profitability or valuation adjustments reflecting better operating efficiency.
- Price to Sales (P/S) Ratio
- The Price to Sales ratio follows a clear downward trajectory, moving from 2.37 in 2019 to a low of 0.85 in 2023. The most pronounced reduction occurs post-2021, suggesting that the valuation relative to sales has contracted significantly, which may reflect increased sales volume, reduced valuation multiples, or a combination of both factors.
- Price to Book Value (P/BV) Ratio
- The Price to Book Value ratio displays a different pattern compared to the other ratios. It rises steadily from 3.46 in 2019 to peak at 7.26 in 2021, indicating increased market valuation relative to the book value during this period. However, from 2021 onwards, the ratio declines to 4.18 by 2023, suggesting a reversal or normalization of valuation levels compared to book value.
Price to Earnings (P/E)
Charter Communications Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Net income attributable to Charter shareholders (in millions) | ||||||
| Earnings per share (EPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/E ratio4 | ||||||
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/E Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/E Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Data adjusted for splits and stock dividends.
2 2023 Calculation
EPS = Net income attributable to Charter shareholders ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Charter Communications Inc. Annual Report.
4 2023 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited a notable increase from $517.46 at the end of 2019 to a peak of $607.56 in 2020. Subsequently, it experienced a decline, dropping to $590.47 in 2021, then sharply falling to $394.41 in 2022 and further decreasing to $319.21 by the end of 2023. Overall, this reflects a significant downward trend in market valuation after 2020.
- Earnings per Share (EPS) Trend
- The EPS showed a consistent upward trajectory from 2019 to 2022, starting at $7.94 and rising to $33.11 by the end of 2022. In 2023, a slight decline occurred, with EPS falling to $31.38. Despite this minor decrease, EPS remains substantially higher than the 2019 figure, indicating strengthened profitability over the period.
- Price-to-Earnings (P/E) Ratio Trend
- The P/E ratio declined steadily over the five-year span, dropping from a high of 65.14 in 2019 to 10.17 in 2023. This decrease reflects the faster growth in earnings relative to the share price, suggesting that the stock has become less expensive in terms of earnings multiple. The consistent reduction of the P/E ratio points towards an improving valuation relative to earnings.
- Overall Analysis
- The data reveals contrasting trends between market valuation and company profitability. While earnings per share increased significantly through 2022 before a modest dip in 2023, the share price peaked early in 2020 followed by a substantial decline. The declining P/E ratio corroborates that earnings growth outpaced the decline in share price, resulting in a cheaper valuation on an earnings basis over time. This dynamic may reflect market skepticism or external factors influencing investor sentiment despite solid earnings performance.
Price to Operating Profit (P/OP)
Charter Communications Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Income from operations (in millions) | ||||||
| Operating profit per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/OP ratio4 | ||||||
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/OP Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/OP Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Data adjusted for splits and stock dividends.
2 2023 Calculation
Operating profit per share = Income from operations ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Charter Communications Inc. Annual Report.
4 2023 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
The data reveals several significant trends in the financial performance and market valuation over the five-year period under review.
- Share Price
- The share price initially increased from $517.46 in 2019 to a peak of $607.56 in 2020. Subsequently, it showed a gradual decline, falling to $590.47 in 2021, then dropping more sharply to $394.41 in 2022, and reaching $319.21 by the end of 2023. This indicates a pronounced downward trend in market valuation over the last three years.
- Operating Profit Per Share
- Operating profit per share exhibited steady growth throughout the period. Starting at $31.01 in 2019, it increased significantly each year to reach $86.48 by 2023. This represents nearly a threefold increase, highlighting improving operational profitability on a per-share basis.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio has shown a marked contraction over the period, declining from 16.69 in 2019 to 3.69 in 2023. This reflects a substantial decrease in market price relative to operating profit per share, suggesting that the stock has become more attractively valued from an operating profit perspective or that investor confidence in the valuation has diminished despite stronger profitability.
Overall, the contrasting trends of increasing operating profit per share and declining share price have driven the P/OP ratio downward. This divergence may indicate that while operational efficiency or profitability has improved, market sentiment or external factors have depressed the stock price, resulting in a lower valuation multiple. The data implies that the company is generating higher operating earnings per share but is currently valued by the market at a lower price multiple relative to those earnings compared to previous years.
Price to Sales (P/S)
Charter Communications Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Revenues (in millions) | ||||||
| Sales per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/S ratio4 | ||||||
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/S Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/S Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Data adjusted for splits and stock dividends.
2 2023 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Charter Communications Inc. Annual Report.
4 2023 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
The analysis of the financial data reveals several notable trends over the five-year period ending December 31, 2023.
- Share Price
- The share price exhibited an initial increase from 517.46 US$ in 2019 to a peak of 607.56 US$ in 2020. It then declined progressively over the subsequent years, falling to 590.47 US$ in 2021, dropping more sharply to 394.41 US$ in 2022, and reaching 319.21 US$ by 2023. This indicates a substantial decrease in market valuation after 2020.
- Sales Per Share
- Sales per share showed a consistent upward trend throughout the period. Starting at 217.95 US$ in 2019, sales per share increased each year, reaching 248.27 US$ in 2020, 299.19 US$ in 2021, 353.89 US$ in 2022, and culminating at 376.02 US$ in 2023. This steady growth suggests ongoing improvement in revenue generation on a per-share basis.
- Price-to-Sales Ratio (P/S)
- The P/S ratio initially increased slightly from 2.37 in 2019 to 2.45 in 2020, reflecting a higher market valuation relative to sales. However, it then declined significantly over the following years to 1.97 in 2021, dropping further to 1.11 in 2022 and finally reaching 0.85 in 2023. This downward trend indicates the market price's growth has not kept pace with increasing sales, resulting in a lower valuation multiple.
Overall, while the company experienced growth in sales per share consistently, the share price trend and declining P/S ratio suggest the market has become more conservative in its valuation. This divergence may reflect changing investor perceptions, external market conditions, or concerns about future profitability despite strong sales performance.
Price to Book Value (P/BV)
Charter Communications Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Total Charter shareholders’ equity (in millions) | ||||||
| Book value per share (BVPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/BV ratio4 | ||||||
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/BV Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/BV Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 Data adjusted for splits and stock dividends.
2 2023 Calculation
BVPS = Total Charter shareholders’ equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Charter Communications Inc. Annual Report.
4 2023 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited an initial increase from $517.46 at the end of 2019 to $607.56 at the end of 2020. Subsequently, it showed a declining trend over the next three years, reaching $590.47 in 2021, dropping more sharply to $394.41 in 2022, and further declining to $319.21 by the end of 2023.
- Book Value Per Share (BVPS) Trend
- The book value per share demonstrated a consistent decline from $149.76 in 2019 to a low of $59.74 in 2022. However, there was a slight recovery in 2023, with BVPS increasing to $76.34. This pattern indicates a reduction in net asset value per share over the period, with a modest rebound in the latest year.
- Price-to-Book Value (P/BV) Ratio Trend
- The P/BV ratio initially rose from 3.46 in 2019 to a peak of 7.26 in 2021, reflecting a higher market valuation relative to book value per share. After this peak, the ratio decreased to 6.6 in 2022 and further dropped to 4.18 by the end of 2023. This suggests that despite the declining share price, the ratio remains elevated compared to the starting point, influenced by the reduction in book value per share.
- Overall Insights
- Over the five-year period, the share price and book value per share have both generally decreased, with the book value showing a steeper decline. The price-to-book ratio increased notably until 2021, signaling heightened market expectations or possibly overvaluation relative to book value during that period. The subsequent decline in the ratio indicates a correction in market valuation, though it remains above the 2019 level. The modest increase in book value per share in 2023 may reflect some improvement in net assets, but the substantial drop in share price during the same year implies continued market caution or concerns.