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Cable ONE (CABO) Q4 Earnings Lag, Revenues Top Estimates
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Cable ONE Inc. (CABO - Free Report) reported mixed financial results in the fourth quarter of 2017. The top line surpassed the Zacks Consensus Estimate, while the bottom line missed the same.
Net Income
Quarterly net income was $143.2 million or $25.18 per share compared with $24.5 million or $4.29 per share in the year-ago quarter. However, fourth-quarter adjusted earnings per share of $5.78 missed the Zacks Consensus Estimate of $5.87.
Total revenues were $257.7 million, up 24.7% year over year surpassing the Zacks Consensus Estimate of $255.5 million. Of the total, Residential Data revenues were approximately $111.8 million, reflecting an increase of 27.2% year over year. Residential Video revenues totaled $86.6 million, up 20.2%. Residential Voice revenues were $11.2 million, reflecting an increase of 9.5%. Business Services segment generated $36.5 million in revenues, up 37.2%. Advertising sales were $7.3 million, reflecting a decline of 0.9%. Other revenues were $4.3 million, up 69.2%.
Operating Metrics
In the reported quarter, operating expenses totaled around $198.7 million, up 24.1% year over year. Operating income was $59 million, up 26.6% year over year. Adjusted EBITDA was $117 million, increasing 26.8% year over year. Adjusted EBITDA margin was 45.4% compared with 44.6% in the year-ago quarter.
Cash Flow
In fourth-quarter 2017, Cable ONE generated $104.7 million of cash from operations compared with $59.5 million in the prior-year quarter. Free cash flow in the reported quarter was $54.2 million compared with $24 million in the prior-year quarter.
Liquidity
At the end of 2017, Cable ONE had $161.8 million of cash and cash equivalents compared with $138 million at the end of 2016. Total debt, at the end of 2017, was $1,175 million compared with $530.9 million at the end of 2016. At the end of 2017, the debt-to-capitalization ratio was 0.63 compared with 0.54 at the end of 2016.
Operating Statistics
As of Dec 31, total customer base of Cable ONE was 797,537, up 21.3% year over year. Non-video customer base was 435,087, reflecting an increase of 29.3% year over year. Non-video customers accounted for 54.6% of the legacy Cable ONE customer count compared with 51.2% at the end of the year-ago quarter.
Residential Segment: Total customers were 731,011, reflecting an increase of 20.7% year over year. Data PSUs were 584,854, up 24.7%. Video PSUs were 346,712, up 13.1%. Voice PSUs count totaled 110,013, up 12.6%. Total residential PSUs were 1,041,579, up 19.3%.
Business Segment: Total customers were 66,526, up 29.1% year over year. Data PSUs were 58,299, up 30%. Video PSUs were 17,176, up 25.5%. Voice PSUs totaled 24,868, up 37.5%. Total PSUs were 97,216, up 28.9%.
Average Revenue per User (ARPU): Residential data ARPU was $63.92, reflecting an increase of 2%. Residential video ARPU was $82.42, up 6.7%. Residential voice ARPU was $33.69, declining 1.9%. Business services ARPU was $184.9, up 6.6%.
Zacks Rank and Other Stocks
Cable ONE is among the top 10 cable MSOs (multi service operator) in the United States, serving nearly 800,000 residential and commercial customers in 21 states with high-speed Internet, cable television and telephone service. However, we are concerned about the company’s operation in a saturated and competitive multi-channel U.S. video market, sharing space with leading cable MSOs like Comcast Corp. (CMCSA - Free Report) , Charter Communications Inc. (CHTR - Free Report) and Altice USA Inc. (ATUS - Free Report) .
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Cable ONE (CABO) Q4 Earnings Lag, Revenues Top Estimates
Cable ONE Inc. (CABO - Free Report) reported mixed financial results in the fourth quarter of 2017. The top line surpassed the Zacks Consensus Estimate, while the bottom line missed the same.
Net Income
Quarterly net income was $143.2 million or $25.18 per share compared with $24.5 million or $4.29 per share in the year-ago quarter. However, fourth-quarter adjusted earnings per share of $5.78 missed the Zacks Consensus Estimate of $5.87.
Cable One, Inc. Price, Consensus and EPS Surprise
Cable One, Inc. Price, Consensus and EPS Surprise | Cable One, Inc. Quote
Revenues
Total revenues were $257.7 million, up 24.7% year over year surpassing the Zacks Consensus Estimate of $255.5 million. Of the total, Residential Data revenues were approximately $111.8 million, reflecting an increase of 27.2% year over year. Residential Video revenues totaled $86.6 million, up 20.2%. Residential Voice revenues were $11.2 million, reflecting an increase of 9.5%. Business Services segment generated $36.5 million in revenues, up 37.2%. Advertising sales were $7.3 million, reflecting a decline of 0.9%. Other revenues were $4.3 million, up 69.2%.
Operating Metrics
In the reported quarter, operating expenses totaled around $198.7 million, up 24.1% year over year. Operating income was $59 million, up 26.6% year over year. Adjusted EBITDA was $117 million, increasing 26.8% year over year. Adjusted EBITDA margin was 45.4% compared with 44.6% in the year-ago quarter.
Cash Flow
In fourth-quarter 2017, Cable ONE generated $104.7 million of cash from operations compared with $59.5 million in the prior-year quarter. Free cash flow in the reported quarter was $54.2 million compared with $24 million in the prior-year quarter.
Liquidity
At the end of 2017, Cable ONE had $161.8 million of cash and cash equivalents compared with $138 million at the end of 2016. Total debt, at the end of 2017, was $1,175 million compared with $530.9 million at the end of 2016. At the end of 2017, the debt-to-capitalization ratio was 0.63 compared with 0.54 at the end of 2016.
Operating Statistics
As of Dec 31, total customer base of Cable ONE was 797,537, up 21.3% year over year. Non-video customer base was 435,087, reflecting an increase of 29.3% year over year. Non-video customers accounted for 54.6% of the legacy Cable ONE customer count compared with 51.2% at the end of the year-ago quarter.
Residential Segment: Total customers were 731,011, reflecting an increase of 20.7% year over year. Data PSUs were 584,854, up 24.7%. Video PSUs were 346,712, up 13.1%. Voice PSUs count totaled 110,013, up 12.6%. Total residential PSUs were 1,041,579, up 19.3%.
Business Segment: Total customers were 66,526, up 29.1% year over year. Data PSUs were 58,299, up 30%. Video PSUs were 17,176, up 25.5%. Voice PSUs totaled 24,868, up 37.5%. Total PSUs were 97,216, up 28.9%.
Average Revenue per User (ARPU): Residential data ARPU was $63.92, reflecting an increase of 2%. Residential video ARPU was $82.42, up 6.7%. Residential voice ARPU was $33.69, declining 1.9%. Business services ARPU was $184.9, up 6.6%.
Zacks Rank and Other Stocks
Cable ONE is among the top 10 cable MSOs (multi service operator) in the United States, serving nearly 800,000 residential and commercial customers in 21 states with high-speed Internet, cable television and telephone service. However, we are concerned about the company’s operation in a saturated and competitive multi-channel U.S. video market, sharing space with leading cable MSOs like Comcast Corp. (CMCSA - Free Report) , Charter Communications Inc. (CHTR - Free Report) and Altice USA Inc. (ATUS - Free Report) .
Cable ONE currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The most popular cryptocurrency skyrocketed last year, giving some investors the chance to bank 20X returns or even more. Those gains, however, came with serious volatility and risk. Bitcoin sank 25% or more 3 times in 2017.
Zacks’ has just released a new Special Report to help readers capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
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