Last month, I announced deep dives sponsored by Tegus. The goal of these are simple: every month, Tegus is going to give me a few expert interviews and I’m going to use those to dive into an investing topic. Some months, it could just be a dive into a specific company; other months, it might be a dive into an industry.
Thanks Andrew, love the idea! Charter/Comcast have the advantage of not feeling like the classic MVNO (Metro PCS etc.). I believe it's their brand value, but people appear a lot more willing to switch to Spectrum/Xfinity mobile but would have never considered your classic MVNO's. A lot of customers could be locked in with a good value cable bundle by the time fiber has been laid and T, VZ, etc. start trying to acquire them.
Why does no one like to talk about the EV/FCF multiples for these businesses? On your EV/UFCF at 16x doesn’t look demanding, except it doesn’t take into account tax payment which the IRS can assure you it’s a very real cash flow. After the NOLs and intangible amortization tax shield runs out, the tax on an unlevered basis is going to be around $3bn. That would make the EV/FCF more like 20x. Not quite as cheap is it?
This whole idea about the cost of debt being below FCF yield is too good to be true IMHO. Why would the market allow such an obvious discrepancy to occur? What if FCF declines?
I am very long and underwater ATUS. l expect a turnaround
Great stuff, thanks Andrew! 💚 🥃
As I remember you said to write an article on ATUS after publishing last q results. Did I miss it or it is yet to come?
Thanks Andrew, love the idea! Charter/Comcast have the advantage of not feeling like the classic MVNO (Metro PCS etc.). I believe it's their brand value, but people appear a lot more willing to switch to Spectrum/Xfinity mobile but would have never considered your classic MVNO's. A lot of customers could be locked in with a good value cable bundle by the time fiber has been laid and T, VZ, etc. start trying to acquire them.
Why does no one like to talk about the EV/FCF multiples for these businesses? On your EV/UFCF at 16x doesn’t look demanding, except it doesn’t take into account tax payment which the IRS can assure you it’s a very real cash flow. After the NOLs and intangible amortization tax shield runs out, the tax on an unlevered basis is going to be around $3bn. That would make the EV/FCF more like 20x. Not quite as cheap is it?
This whole idea about the cost of debt being below FCF yield is too good to be true IMHO. Why would the market allow such an obvious discrepancy to occur? What if FCF declines?
Would love if you had a TLDR....like your boy DeMuth!
"ATUS is ATUS"
😅