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Editor's Note: Below is a flashback from Hedgeye Communications analyst Andrew Freedman's short Altice (ATUS) research call. Following a forecasted drop in customers accelerating, ATUS has fallen over -20% in the last five trading days. Below is updated analysis with Hedgeye CEO Keith McCullough as well as key takeaways on why Freedman went short the stock back in 2019. For more info on Communications Pro research, click HERE. |
FROM FREEDMAN today on the call @ hedgeye:
For more info on Communications Pro research click HERE.
FROM FREEDMAN's Initial stock call
We have had a long bias on ATUS since March 2019 as management's strategic initiatives were bearing fruit at the same time growth comparisons were easing, and the company was initiating an attractive capital return program.
However, much of what we liked is now becoming a risk to the company's growth algorithm (2-3% revenue growth / 4-5% EBITDA) as we head into 2020. Therefore, we are switching sides and moving ATUS to an active short targeting 20-30% downside in the next 6-9 months.
We expect below-consensus revenue, EBITDA and free cash flow growth in 2020 due to:
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