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Liberty Broadband (LBRDK)
:LBRDK
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Liberty Broadband
(NASDAQ:LBRDK)
Rating:77Outperform
Price Target:
$108.00
▲(9.78%Upside)
Positive Factors
Financial Performance
Better than expected 4Q results from Liberty’s relatively small 'GCI' Alaskan cable/telco assets.
Strategic Transactions
The firm’s announced merger with BUY rated CHTR.
Valuation
A reduction in the public NAV discount from 15% to 8% led to a material $40 increase in the LBRDK target price to $145.
Negative Factors
Market Risks
Market volatility can drive a widening of the NAV gap, posing a risk to investors.
Shareholder Risks
Liberty shareholders have all the risks of Charter shareholders, including the possibility that a deal with CHTR could occur at a lower than expected valuation or may not happen.
Liberty Broadband (LBRDK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$13.76B
Dividend YieldN/A
Average Volume (3M)1.47M
Price to Earnings (P/E)15.7
Beta (1Y)0.85
Revenue Growth5.82%
EPS Growth5.40%
CountryUS
Employees1,900
SectorCommunication Services
Sector Strength93
IndustryTelecommunications Services
Share Statistics
EPS (TTM)1.87
Shares Outstanding123,071,780
10 Day Avg. Volume1,754,304
30 Day Avg. Volume1,471,867
Financial Highlights & Ratios
PEG Ratio0.09
Price to Book (P/B)1.41
Price to Sales (P/S)0.00
P/FCF Ratio-56.48
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue3.84
Enterprise Value/Gross Profit22.22
Enterprise Value/Ebitda3.99
Forecast
1Y Price Target
$130.00Price Target Upside32.14% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
Liberty Broadband Business Overview & Revenue Model
Company DescriptionLiberty Broadband Corporation engages in the communications businesses. It operates through GCI Holdings and Charter segments. The GCI Holdings segment provides a range of wireless, data, video, voice, and managed services to residential customers, businesses, governmental entities, and educational and medical institutions primarily in Alaska under the GCI brand. The Charter segment offers subscription-based video services comprising video on demand, high-definition television, and digital video recorder service; local and long-distance calling, voicemail, call waiting, caller ID, call forwarding, and other voice services, as well as international calling services; and Spectrum TV. It also provides internet services, including an in-home Wi-Fi product that provides customers with high-performance wireless routers and managed Wi-Fi services; advanced community Wi-Fi; mobile internet; and a security suite that offers protection against computer viruses and spyware. In addition, this segment offers internet access, data networking, fiber connectivity to cellular towers and office buildings, video entertainment, and business telephone services; advertising services on cable television networks and digital outlets; and operates regional sports and news networks. Liberty Broadband Corporation was incorporated in 2014 and is based in Englewood, Colorado.
How the Company Makes MoneyLiberty Broadband makes money primarily through its equity interests in Charter Communications, one of the largest cable operators in the United States. The company derives revenue from its ownership stake, benefiting from Charter's subscription services, including cable television, internet, and phone services. Additionally, Liberty Broadband holds interests in GCI Liberty, which provides broadband, cable, and wireless services in Alaska, contributing to overall earnings. These strategic investments allow Liberty Broadband to capitalize on the growth and profitability of its associated companies, driving its revenue model.
Liberty Broadband Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 5.17%|
Next Earnings Date:Aug 01, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance and strategic achievements, particularly in rural Alaska expansion and credit refinancing. However, it also noted challenges, including service disruptions and subscriber declines. Despite these issues, the overall sentiment was positive due to significant growth metrics and successful strategic initiatives.Q1-2025 Updates
Positive Updates
Record Revenue and OIBDA Growth
GCI reported its best quarter ever with revenue of $266 million and adjusted OIBDA of $111 million, representing increases of 9% and 23% respectively over the prior year.
Expansion of Services in Rural Alaska
GCI completed the connection of Bethel, the largest community in Western Alaska, with fiber from Anchorage, offering 5G wireless and 2.5 gigabits unlimited broadband services.
Successful Refinancing of Credit Facility
GCI refinanced its senior credit facility, securing a $450 million revolver maturing in 2030 and a $300 million Term Loan A maturing in 2031, providing good liquidity.
Partially Restored Network After Fiber Break
GCI, in cooperation with Quintillion, partially restored network services disrupted by a fiber break using LEO satellite capacity and rerouted connections.
Negative Updates
Consumer Services Disruption Due to Fiber Break
GCI's consumer services experienced disruptions due to a fiber break under the Beaufort Sea, with expected repairs not completed until late summer.
Decline in Wireless and Cable Modem Subscribers
GCI Consumer saw a decline of 400 wireless subscribers and 5,000 cable modem customers, partly due to the termination of the ACP program.
Company Guidance
During the Liberty Broadband 2025 Q1 Earnings Call, various guidance metrics were discussed, including financial and operational updates. Liberty Broadband had consolidated cash and restricted cash of $565 million, with $149 million at GCI, and $338 million of restricted cash at Liberty Broadband for debt service. The total principal amount of debt was $3.7 billion, excluding preferred stock. GCI's first quarter revenue was $266 million, with an adjusted OIBDA of $111 million, representing a 9% and 23% increase over the previous year, respectively, and an adjusted OIBDA margin of 42%. The company reported a decline in wireless subscribers by 400 and 5,000 cable modem customers, largely due to the termination of the ACP program in 2024. GCI’s leverage was 2.8 times, and the credit facility had $292 million of undrawn capacity. Capital expenditures were $49 million in the first quarter, with net CapEx for 2025 expected to be $250 million. GCI completed a significant milestone by connecting Bethel with fiber from Anchorage, offering enhanced broadband services.Liberty Broadband Financial Statement Overview
Summary
Liberty Broadband demonstrates strong revenue and profit growth with solid margins and a healthy balance sheet. However, the negative free cash flow is a concern, indicating challenges in generating excess cash post-capital expenditures, which could impact liquidity.Income Statement
Liberty Broadband has demonstrated a consistent increase in revenue, with a TTM (Trailing-Twelve-Months) revenue growth rate of approximately 2.07%. Gross profit margin is solid at about 67.22% TTM, indicating effective cost management. Net profit margin is also strong at 86.41% TTM, showing high profitability. However, there was a decline in EBITDA margin from 2023 to TTM, suggesting room for improvement in operational efficiency.78
Positive
Balance Sheet
The company maintains a strong equity position with an equity ratio of 59.15% TTM, indicating healthy financial stability. The debt-to-equity ratio stands at 0.39, suggesting manageable leverage levels. Return on equity is robust at 8.91% TTM, reflecting effective use of shareholders' funds. However, the slight increase in total debt over the periods may warrant close monitoring.72
Positive
Cash Flow
Free cash flow is negative at -$121 million TTM, indicating challenges in generating excess cash post-capital expenditures. On the positive side, operating cash flow to net income ratio at 0.15 TTM suggests some operational cash generation. The company should focus on improving its free cash flow to net income ratio, which is currently negative, to enhance financial flexibility.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.04B | 1.02B | 981.00M | 920.98M | 988.00M | 50.71M |
| Gross Profit | 697.00M | 552.00M | 736.00M | 639.98M | 659.00M | 50.65M |
| EBITDA | 1.36B | 1.48B | 1.32B | 290.00M | 264.00M | 671.20M |
| Net Income | 896.00M | 869.00M | 688.00M | 1.26B | 732.00M | 398.00M |
Balance Sheet | ||||||
| Total Assets | 17.00B | 16.85B | 15.64B | 15.14B | 16.97B | 21.37B |
| Cash, Cash Equivalents and Short-Term Investments | 226.00M | 163.00M | 158.00M | 375.00M | 191.00M | 1.42B |
| Total Debt | 3.88B | 3.83B | 3.82B | 3.89B | 3.85B | 4.91B |
| Total Liabilities | 6.93B | 6.88B | 6.62B | 6.64B | 6.83B | 7.86B |
| Stockholders Equity | 10.05B | 9.99B | 9.00B | 8.48B | 10.13B | 13.50B |
Cash Flow | ||||||
| Free Cash Flow | -121.00M | -143.00M | -206.00M | -212.00M | -131.00M | -97.56M |
| Operating Cash Flow | 130.00M | 104.00M | 16.00M | -56.00M | 3.00M | -95.74M |
| Investing Cash Flow | 369.00M | 130.00M | 150.00M | 3.05B | 4.06B | 575.51M |
| Financing Cash Flow | -48.00M | -181.00M | -390.00M | -2.80B | -5.29B | 903.80M |
Liberty Broadband Technical Analysis
Positive
98.38
Price Trends
92.13
Positive
86.88
Positive
83.24
Positive
Market Momentum
0.78
Negative
61.70
Neutral
84.58
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LBRDK, the sentiment is Positive. The current price of 98.38 is above the 20-day moving average (MA) of 93.50, above the 50-day MA of 92.13, and above the 200-day MA of 83.24, indicating a bullish trend. The MACD of 0.78 indicates Negative momentum. The RSI at 61.70 is Neutral, neither overbought nor oversold. The STOCH value of 84.58 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LBRDK.
Liberty Broadband Risk Analysis
Liberty Broadband disclosed 9 risk factors in its most recent earnings report. Liberty Broadband reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Liberty Broadband Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $131.87B | 8.67 | 18.57% | 3.74% | 1.33% | 7.69% | |
77 Outperform | $13.76B | 15.70 | 9.15% | ― | 5.82% | 5.40% | |
71 Outperform | $110.78B | 11.12 | 36.94% | ― | 0.93% | 16.06% | |
61 Neutral | $41.41B | -1.30 | -14.21% | 3.95% | 2.45% | -73.69% | |
50 Neutral | $3.46B | ― | -20.95% | ― | 3.53% | 3.23% | |
50 Neutral | $3.46B | ― | -20.95% | ― | 3.53% | 3.23% | |
48 Neutral | $9.08B | ― | -7.64% | ― | 3.69% | -1514.85% |
* Communication Services Sector Average
Performance Comparison
LBRDK
Liberty Broadband
98.38
44.29
81.88%
CHTR
Charter Communications
408.81
112.79
38.10%
CMCSA
Comcast
35.69
-1.24
-3.36%
LBTYA
Liberty Global A
10.01
0.95
10.49%
LBTYK
Liberty Global C
10.31
0.89
9.45%
FYBR
Frontier Communications Parent
36.40
10.34
39.68%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.