Charter Communications, Inc. (CHTR): A Bull Case Theory

We came across a bullish thesis on Charter Communications, Inc. on r/Valueinvesting by ninjagorilla. In this article, we will summarize the bulls’ thesis on CHTR. Charter Communications, Inc.'s share was trading at $239.09 as of February 13th. CHTR’s trailing and forward P/E were 6.60  and 5.50, respectively according to Yahoo Finance.

Charter Communications (CHTR) presents a compelling investment opportunity despite its recent challenges, including modest broadband subscriber losses and a perception of declining relevancy. The company has, however, slightly outperformed expectations by losing fewer broadband customers than anticipated and adding mobile subscribers, suggesting stabilization and potential for modest growth later this year. While its forward P/E sits at an unusually low level of 2, the key driver of the investment thesis lies elsewhere.

Over the past several years, Charter has undertaken a massive capital expenditure program to upgrade its network infrastructure, spending $12 billion in 2025 alone, with spending expected to decline steadily over the next four years. As this capex cycle winds down—from $11 billion in 2026 to $7 billion in 2028 and beyond—the company’s free cash flow is projected to increase dramatically, not due to higher profitability, but as a result of reduced capital spending.

Management has indicated that a significant portion of this free cash flow will be returned to shareholders through share repurchases, which could retire nearly 50% of outstanding shares over the next five years at current prices and projections. This combination of low valuation, cash flow acceleration, and aggressive buybacks creates a unique opportunity for investors seeking outsized returns.

By 2026, Charter is projected to generate free cash flow per share of $36, corresponding to a 14% free cash flow yield, which could surge to $121 per share and a 56% yield by 2029. The structural de-risking of its business and capital allocation strategy positions Charter for a potential rerating, offering an exceptional risk/reward profile for long-term investors.