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Cable ONE (CABO) Tops Earnings and Revenue Estimates in Q1
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Small-sized cable MSO (multi service operator), Cable ONE Inc. (CABO - Free Report) reported strong financial results in the first quarter of 2017, wherein both the top line and bottom line surpassed the Zacks Consensus Estimate.
Quarterly net income was $33.2 million, highlighting an increase of 22.9% from the first quarter of 2016. First-quarter 2017 earnings per share of $5.80 outpaced the Zacks Consensus Estimate of $5.62.
Total revenue was $207.4 million, up 2.3% year over year and slightly above the Zacks Consensus Estimate of $206.8. Of the total, Residential Data revenues were approximately $90.2 million, up 8.1%. Residential Video revenues totaled $72.5 million, down 3.2%. Residential Voice revenues were $9.9 million, down 12.8%. Business Services segment generated $27 million in revenues, up 13.2%. Advertising sales were $5.6 million, down 19.7%. Other revenues were $2.3 million, down 2%.
In the reported quarter, operating expenses totaled $147.1 million, down 5.4% year over year. Operating income was $60.4 million, up 27.4% year over year. Adjusted EBITDA was $97.9 million, up 14.6% year over year. Adjusted EBITDA margin was 47.2% compared with 42.1% in the year-ago quarter. Net profit margin was 16% compared with 13.3% in the year-ago quarter.
Cash Flow
In the first quarter of 2017, Cable ONE generated $78.3 million of cash from operations compared with $77.5 million in the prior-year quarter. Free cash flow, in the reported quarter was $42.3 million compared with $50.1 million in the year-ago quarter.
Liquidity
At the end of the first quarter of 2017, Cable ONE had $173.5 million of cash and cash equivalents compared with $138 million at the end of 2016. Total debt, at the end of first-quarter 2017 was $536.3 million compared with $537.1 million at the end of 2016. At the end of the reported quarter, the debt-to-capitalization ratio was 0.52 compared with 0.54 at the end of 2016.
As of Mar 31, 2017, the total customer base of Cable ONE was 660,968, down 0.7% year over year. Non-video customer base was 353,205, up 13.7% year over year. Non-video customers accounted for 53% of the total customer count compared with 47% at the end of the year-ago quarter.
Residential Segment: Total customers were 608,515, down 1.4% year over year. Data PSUs were 477,439, up 2.2%. Video PSUs were 293,726, down 12.7%. Voice PSUs count totaled 94,741, down 11.7%. Total PSUs were 865,906, down 4.9%.
Business Segment: Total customers were 52,453, up 8.5% year over year. Data PSUs were 45,888, up 11%. Video PSUs were 13,461, down 4.2%. Voice PSUs totaled 18,627, up 12.5%. Total PSUs were 77,976, up 8.4%.
Average Revenue Per User (ARPU): Residential data ARPU was $63.53, up 6%. Residential video ARPU was $80.47, up 10.7%. Residential voice ARPU was $34.18, down 1%. Business services ARPU was $172.87, up 4.2%.
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Cable ONE (CABO) Tops Earnings and Revenue Estimates in Q1
Small-sized cable MSO (multi service operator), Cable ONE Inc. (CABO - Free Report) reported strong financial results in the first quarter of 2017, wherein both the top line and bottom line surpassed the Zacks Consensus Estimate.
Quarterly net income was $33.2 million, highlighting an increase of 22.9% from the first quarter of 2016. First-quarter 2017 earnings per share of $5.80 outpaced the Zacks Consensus Estimate of $5.62.
Total revenue was $207.4 million, up 2.3% year over year and slightly above the Zacks Consensus Estimate of $206.8. Of the total, Residential Data revenues were approximately $90.2 million, up 8.1%. Residential Video revenues totaled $72.5 million, down 3.2%. Residential Voice revenues were $9.9 million, down 12.8%. Business Services segment generated $27 million in revenues, up 13.2%. Advertising sales were $5.6 million, down 19.7%. Other revenues were $2.3 million, down 2%.
In the reported quarter, operating expenses totaled $147.1 million, down 5.4% year over year. Operating income was $60.4 million, up 27.4% year over year. Adjusted EBITDA was $97.9 million, up 14.6% year over year. Adjusted EBITDA margin was 47.2% compared with 42.1% in the year-ago quarter. Net profit margin was 16% compared with 13.3% in the year-ago quarter.
Cash Flow
In the first quarter of 2017, Cable ONE generated $78.3 million of cash from operations compared with $77.5 million in the prior-year quarter. Free cash flow, in the reported quarter was $42.3 million compared with $50.1 million in the year-ago quarter.
Liquidity
At the end of the first quarter of 2017, Cable ONE had $173.5 million of cash and cash equivalents compared with $138 million at the end of 2016. Total debt, at the end of first-quarter 2017 was $536.3 million compared with $537.1 million at the end of 2016. At the end of the reported quarter, the debt-to-capitalization ratio was 0.52 compared with 0.54 at the end of 2016.
Cable ONE operates and shares space with leading cable MSOs like Comcast Corp. (CMCSA - Free Report) , Charter Communications Inc. (CHTR - Free Report) and AT&T Inc. (T - Free Report) in an intensely competitive cable TV market. The company currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Operating Statistics
As of Mar 31, 2017, the total customer base of Cable ONE was 660,968, down 0.7% year over year. Non-video customer base was 353,205, up 13.7% year over year. Non-video customers accounted for 53% of the total customer count compared with 47% at the end of the year-ago quarter.
Residential Segment: Total customers were 608,515, down 1.4% year over year. Data PSUs were 477,439, up 2.2%. Video PSUs were 293,726, down 12.7%. Voice PSUs count totaled 94,741, down 11.7%. Total PSUs were 865,906, down 4.9%.
Business Segment: Total customers were 52,453, up 8.5% year over year. Data PSUs were 45,888, up 11%. Video PSUs were 13,461, down 4.2%. Voice PSUs totaled 18,627, up 12.5%. Total PSUs were 77,976, up 8.4%.
Average Revenue Per User (ARPU): Residential data ARPU was $63.53, up 6%. Residential video ARPU was $80.47, up 10.7%. Residential voice ARPU was $34.18, down 1%. Business services ARPU was $172.87, up 4.2%.
Cable One, Inc. Price, Consensus and EPS Surprise
Cable One, Inc. Price, Consensus and EPS Surprise | Cable One, Inc. Quote
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Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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