The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how WideOpenWest (NYSE: WOW) and the rest of the wireless, cable and satellite stocks fared in Q2.
The massive physical footprints of cell phone towers, fiber in the ground, or satellites in space make it challenging for companies in this industry to adjust to shifting consumer habits. Over the last decade-plus, consumers have ‘cut the cord’ to their landlines and traditional cable subscriptions in favor of wireless communications and streaming video. These trends do mean that more households need cell phone plans and high-speed internet. Companies that successfully serve customers can enjoy high retention rates and pricing power since the options for mobile and internet connectivity in any geography are usually limited.
The 8 wireless, cable and satellite stocks we track reported a slower Q2. As a group, revenues beat analysts’ consensus estimates by 0.8%.
Thankfully, share prices of the companies have been resilient as they are up 9.9% on average since the latest earnings results.
Slowest Q2: WideOpenWest (NYSE: WOW)
Initially started in Denver as a cable television provider, WideOpenWest (NYSE: WOW) provides high-speed internet, cable, and telephone services to the Midwest and Southeast regions of the U.S.
WideOpenWest reported revenues of $144.2 million, down 9.2% year on year. This print was in line with analysts’ expectations, but overall, it was a disappointing quarter for the company with a significant miss of analysts’ adjusted operating income and EPS estimates.
"During the second quarter we passed an additional 15,500 new homes in our all-fiber Greenfield markets. As we continue to accelerate our fiber-to-the-home expansion, we're seeing growth in HSD Greenfield subscribers and consistently strong penetration rates," said Teresa Elder, WOW!'s CEO.
WideOpenWest delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 51.5% since reporting and currently trades at $5.16.
Read our full report on WideOpenWest here, it’s free.
Best Q2: Verizon (NYSE: VZ)
Formed in 1984 as Bell Atlantic after the breakup of Bell System into seven companies, Verizon (NYSE: VZ) is a telecom giant providing a range of communications and internet services.
Verizon reported revenues of $34.5 billion, up 5.2% year on year, outperforming analysts’ expectations by 2.3%. The business had a satisfactory quarter with a beat of analysts’ EPS estimates.
Verizon scored the biggest analyst estimates beat and fastest revenue growth among its peers. The company added 162,000 customers to reach a total of 146.1 million. The market seems happy with the results as the stock is up 7.5% since reporting. It currently trades at $43.85.
Is now the time to buy Verizon? Access our full analysis of the earnings results here, it’s free.
Altice (NYSE: ATUS)
Based in Long Island City, Altice USA (NYSE: ATUS) is a telecommunications company offering cable, internet, telephone, and television services across the United States.
Altice reported revenues of $2.15 billion, down 4.2% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ adjusted operating income andEPS estimates.
Altice delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 8% since the results and currently trades at $2.57.
Read our full analysis of Altice’s results here.
AT&T (NYSE: T)
Founded by Alexander Graham Bell, AT&T (NYSE: T) is a multinational telecomm conglomerate providing a range of communications and internet services.
AT&T reported revenues of $30.85 billion, up 3.5% year on year. This result topped analysts’ expectations by 1.3%. More broadly, it was a mixed quarter as it underperformed in some other aspects of the business.
The stock is up 3% since reporting and currently trades at $28.24.
Read our full, actionable report on AT&T here, it’s free.
Charter (NASDAQ: CHTR)
Operating as Spectrum, Charter (NASDAQ: CHTR) is a leading telecommunications company offering cable television, high-speed internet, and voice services across the United States.
Charter reported revenues of $13.77 billion, flat year on year. This number met analysts’ expectations. Taking a step back, it was a slower quarter as it produced a significant miss of analysts’ EPS and adjusted operating income estimates.
The stock is down 27.2% since reporting and currently trades at $276.50.
Read our full, actionable report on Charter here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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