Is Time Warner Cable’s Stock a Buy Now?

December 23, 2012

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E = Equity to Debt Ratio Is Weak

The debt-to-equity ratio for Time Warner Cable is high. It’s much higher than the debt-to-equity ratio for Comcast Corporation (NASDAQ:CMCSA). The balance sheet isn’t pretty, either.

	Debt-To-Equity	Cash	Long-Term Debt
TWC	3.55	$3.88 Billion	$27.36 Billion
CMCSA	.78	$10.30 Billion	$38.59 Million
CVC	N/A	$822.79 Million	$11.30 Billion

T = Technicals on the Stock Chart Are Strong

Time Warner Cable’s stock has performed extremely well over the past three years. It has outperformed Cablevision Systems Corporation (NYSE:CVC) by a significant margin.

	1 Month	Year-To-Date	1 Year	3 Year
TWC	6.85%	55.28%	58.67%	148.70%
CMCSA	7.11%	62.60%	66.03%	133.80%
CVC	6.99%	9.96%	22.63%	-37.29%

At $95.98, Time Warner Cable is currently trading above all its averages.

50-Day SMA	95.40
100-Day SMA	92.81
200-Day SMA	86.17

E = Earnings and Revenue Have Been Poor

Revenue has been steadily improving over the years. Earnings have been impressive over the past three years.

	2007	2008	2009	2010	2011
Revenue ($)in billions	15.96	17.20	17.87	18.87	19.68
Diluted EPS ($)	3.45	-22.55	3.05	3.64	4.97

Looking at the last quarter on a YoY basis, we see a nice increase in revenue and earnings.

	9/2011	12/2011	3/2012	6/2012	9/2012
Revenue ($)in billions	4.91	4.99	5.13	5.40	5.36
Diluted EPS ($)	1.08	1.72	1.20	1.43	2.60

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