According to a recent report by LightReading, leading cable MSO (multi service operator) Charter Communications Inc. CHTR has decided to rebrand its Enterprise Business Service division within the next three weeks. This signals the company’s intent to aggressively pursue high-speed fiber deployment for its enterprise clients.
Charter Communications recently acquired two big cable MSOs, namely, Time Warner Cable and Bright House Networks, which has positioned the company as the second largest cable MSO after Comcast Corp. CMCSA. Notably, Charter Communications has already launched a rebranding drive for its triple-play residential service offering.
In recent days, the business services segment of the cable TV industry has become fiercely competitive. Verizon Communications Inc. VZ has acquired fiber businesses of XO Communications, CenturyLink Inc. CTL and Level 3 Communications Inc. LVLT have decided to merger and Frontier Communications Corp. FTR has taken over a significant part of Verizon’s wireline business. All these stocks currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The rapidly developing business services division has become a major windfall for cable MSOs in the U.S., and Charter Communications being no exception to this trend and has been aggressively targeting this space. Notably, in the third quarter of 2016, the company’s commercial revenue totaled $1.38 billion. Meanwhile, Charter Communications has launched a website – enterprise.spectrum.com – that will offer content and particulars regarding reliable and scalable network solutions specifically for mid and large-sized business organizations.
We believe increased investments in the enterprise segment are likely to boost Charter Communications’ top line, going forward. After its acquisition of Time Warner Cable, the company gained a huge base of large enterprise customers. The combined entity is likely to achieve the necessary economies of scale to serve large business enterprises. Further, the company plans to launch a full Spectrum small business product, pricing and packaging in Time Warner Cable and Bright House markets in early to mid-2017.
Charter Communications currently carries a Zacks Rank #4 (Sell).
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