Company Overview
Cable One, Inc. operates as a provider of data, video, and voice services for both residential and business customers across the United States, offering specialized residential data services, Wi-Fi signal enhancement, and expert technology support alongside network infrastructure. The company functions within the Communication Services sector, specifically targeting the Telecom Services industry, where it delivers essential connectivity solutions that form the backbone of modern digital communication for households and enterprises. Its operational scale is reflected in a market capitalization of $540.05M and an annual revenue of $1.50B, supported by an employee base of 2592 individuals dedicated to maintaining its service networks. These financial figures indicate that Cable One holds a niche position in the telecommunications landscape, possessing a market capitalization that suggests a mid-cap profile with a revenue stream that, while substantial, reflects the capital-intensive nature of the telecom sector.
Financial Health
The company reported a trailing twelve-month revenue of $1.50B paired with a net income loss of $-356,459,008, while maintaining an EBITDA of $728.19M. The significant disparity between the revenue figure and the negative net income reveals a cost structure where operating expenses, interest, and taxes consumed the entire operating profit, resulting in a net loss despite positive earnings before interest and taxes. Despite the net loss, the entity generated free cash flow of $192.40M, which indicates a degree of financial flexibility allowing for potential debt servicing or operational adjustments independent of reported accounting earnings. The company's profitability metrics show a gross margin of 73.9%, an operating margin of 25.1%, and a profit margin of -23.7%, suggesting that while the core business retains high value from its services, non-operating costs severely impact the bottom line. On the balance sheet, the company holds $162.01M in cash against $3.22B in debt, a configuration highlighted by a debt-to-equity ratio of 224.51 that characterizes a highly leveraged financial position. Liquidity constraints are evident with a current ratio of 0.40, which indicates that current assets are insufficient to cover current liabilities without relying on external financing or asset sales. Return on equity stands at -22.1% and return on assets is 4.0%, metrics that reveal management is currently generating returns that are negative relative to shareholder equity but show a modest positive return relative to the total asset base utilized.
Valuation Assessment
Valuation multiples for the stock include a trailing P/E ratio that is listed as N/A due to the negative net income, contrasted with a forward P/E of 2.57 which implies market expectations for future earnings normalization. The price-to-book ratio is 0.37, indicating that the market values the company at significantly less than its book value, often a signal of undervaluation or distress associated with the high leverage profile. Alternative valuation metrics further define the stock's price, with a price-to-sales ratio of 0.36 and an EV/EBITDA of 4.94, suggesting the market prices the company based heavily on its cash-generating capability (EBITDA) rather than traditional earnings or book value. Price action over the last year has seen the stock range between a 52-week high of $277.96 and a 52-week low of $70.37, with the current trading price situated well below the recent high, reflecting the significant volatility and downward pressure evident in the chart. The beta of 0.71 suggests that the stock's price volatility is lower than the broader market, moving with less intensity than the overall index despite the high debt burden.
Growth & Income
Revenue growth year-over-year has declined by -6.1%, while earnings growth is N/A given the negative net income, indicating that earnings are not growing faster than revenue but rather that both are under pressure from the company's high fixed costs and debt obligations. The company maintains a dividend yield of 9.0% with a payout ratio of 457.4%, a metric that signals the dividend is not sustainable given the current earnings and requires capitalization of cash reserves or additional financing to maintain. This payout structure highlights a critical divergence where the company distributes income far exceeding its profitability, necessitating a reliance on cash flow or debt to fund the yield rather than earnings retention. Overall, the growth and income profile presents a challenging dichotomy of negative revenue trends, a highly leveraged balance sheet, and a dividend yield that exceeds the company's ability to pay from current profits.