Brennan Asset Management, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. Approximately half of the US was thrilled with the election result, and the equilibrium felt catatonic. At first, the markets surged, mostly due to expectations of tax extensions and maybe regulatory relief. The largest winners were some of the more speculative segments of the market, including Tesla stock, investments with an artificial intelligence theme, “normal” cryptocurrency, Dogecoin and other weird/”less normal” cryptocurrencies. This relief rally stalled following the Federal Reserve’s December meeting, which indicated fewer rate cuts in 2025. Meanwhile, markets outside the US continue to trade at extreme discounts, as do value equities to their growth counterparts. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2024.
In its fourth quarter 2024 investor letter, Brennan Asset Management emphasized stocks such as Charter Communications, Inc. (NASDAQ:CHTR). Charter Communications, Inc. (NASDAQ:CHTR) is a broadband connectivity and cable operator company. One-month return of Charter Communications, Inc. (NASDAQ:CHTR) was 2.27%, and its shares gained 20.54% of their value over the last 52 weeks. On February 12, 2025, Charter Communications, Inc. (NASDAQ:CHTR) stock closed at $354.56 per share with a market capitalization of $55.6 billion.
Brennan Asset Management stated the following regarding Charter Communications, Inc. (NASDAQ:CHTR) in its Q4 2024 investor letter:
“Charter Communications, Inc. (NASDAQ:CHTR): Still Hated…But Progress Continues and CHTR/Liberty Broadband (LBRDK) Terms Finalized: We discussed Charter (CHTR) in our 2024 Q1 letter and then reviewed CHTR’s offer to repurchase Liberty Broadband shares in our Q3 2024 letter. CHTR continues to show operational progress. While there is likely to be some continued Affordable Connectivity Program (ACP) noise during the early part of 2025, CHTR has done an admirable job in retaining customers, and total losses are far lower than originally feared. While the stock (frustratingly) will bounce around with small changes in quarterly broadband additions/losses versus expectations, we still believe that CHTR’s ultimate success will come down to whether they can create packages that encourage customers to jointly consider broadband and cell phone prices rather than mentally segregating the two bills. As we previously discussed, we are cautiously optimistic that CHTR’s more aggressive broadband/bundling packages can do just that. We also believe that CHTR’s streaming aggregation product could be another positive differentiator. During its third quarter conference call, CHTR announced that it did not expect to be a meaningful participant in the Broadband Equity, Access, and Deployment (BEAD) program. This cutback in expansionary capex after 2025 likely means a more rapid return to aggressive share repurchases, especially once the company’s network investments are completed in 2027.
Separately, CHTR and LBRDK came to terms with the merger proposal that we discussed in our third quarter letter. The final deal was probably viewed somewhat disappointingly by LBRDK investors, considering that the exchange ratio was closer to CHTR’s original proposal — 0.236 shares of CHTR for each LBRDK share with GCI Communications (GCI) not included versus LBRDK’s proposal for 0.29 CHTR/LBRDK including GCI. That said, the part that most frustrated some was disclosure that the LBRDK/CHTR deal will not close until June 2027. This later closing was designed so LBRDK could sell down CHTR and deleverage prior to the merger, but this also means that LBRDK likely will trade at a discount until closer to deal closing. While we understand the criticisms, CHTR was the only likely buyer for LBRDK, and this deal will simplify CHTR’s capital structure and ultimately allow a collapse of the LBRDK discount.”
A line of cable boxes and modern televisions, representing the company’s video services.
Charter Communications, Inc. (NASDAQ:CHTR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 61 hedge fund portfolios held Charter Communications, Inc. (NASDAQ:CHTR) at the end of the third quarter which was 48 in the previous quarter. While we acknowledge the potential of Charter Communications, Inc. (NASDAQ:CHTR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article we discussed Charter Communications, Inc. (NASDAQ:CHTR) and shared the list of Warren Buffett’s longest-held stocks. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.