Analysts’ Opinions Are Mixed on These Services Stocks: Altice Usa Inc (NYSE: ATUS) and Marriott International (NASDAQ: MAR)

By Ryan Adsit

Analysts have been eager to weigh in on the Services sector with new ratings on Altice Usa Inc (NYSE: ATUS) and Marriott International (NASDAQ: MAR).

Altice Usa Inc (NYSE: ATUS)

Pivotal Research analyst Jeffrey Wlodarczak assigned a Buy rating to Altice Usa Inc (NYSE: ATUS) today and set a price target of $25. The company’s shares opened today at $18.67, close to its 52-week low of $17.80.

Wlodarczak said:

“We also updated our forecasts to account for the new Disney deal and tweaked our medium/long term EBITDA forecasts to better account for what we forecast will be higher customer service expenses. For 4Q we are now expecting (-17K) RGU losses (vs. our previous flat expectation), +2.6% revenue growth & +14% adjusted EBITDA growth. The changes + a conservative reduction in our target free cash flow multiple (from 15 to 12.5X) drove a $5 reduction in our YE’18 target price to $25, which still represents material upside from current levels. At current levels ATUS trades at 9X ’18 FCF (11X tax adjusted). In 2018 ATUS has $1.55B in debt maturities that should easily be retired via cash on hand, free cash flow and potentially tapping into $1.5B in available credit facilities. In ’19 they have $526M in maturities and $500M in ’20.”

According to TipRanks.com, Wlodarczak is a 4-star analyst with an average return of 8.8% and a 65.8% success rate. Wlodarczak covers the Services sector, focusing on stocks such as Liberty Media Corporation Series A Liberty SiriusXM Common Stock, Liberty Global PLC LiLAC Class A, and Telenet Group Holding NV.

Altice Usa Inc has an analyst consensus of Moderate Buy, with a price target consensus of $29.14.

Marriott International (NASDAQ: MAR)

In a report released today, Carlo Santarelli from Deutsche Bank assigned a Hold rating to Marriott International (NASDAQ: MAR), with a price target of $124. The company’s shares opened today at $127.74, close to its 52-week high of $129.56.

According to TipRanks.com, Santarelli is a 5-star analyst with an average return of 15.5% and a 76.1% success rate. Santarelli covers the Services sector, focusing on stocks such as Melco Resorts & Entertainment Limited, International Game Technology, and Pinnacle Entertainment.

Currently, the analyst consensus on Marriott International is Hold and the average price target is $122.86, representing a -3.8% downside.

In a report issued on November 28, Barclays also maintained a Hold rating on the stock with a $130 price target.

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