Can LBTYB sustain its EPS growth into 2025?
4/10/2025 04:24pm
**Liberty Global Class B (LBTYB) is unlikely to sustain its EPS growth into 2025** based on several factors indicating potential challenges and uncertainties.
1. **Recent Performance and Analyst Ratings**:
- Liberty Global's stock has experienced a significant drop of 5.46%, and while it has reached a 52-week high of $21.9, the stock's performance is volatile.
- Analyst ratings suggest a cautious outlook with 36% recommending a buy, 50% suggesting a hold, and 14% advising a sell. This indicates a lack of consensus on the stock's future performance.
2. **Financial Challenges**:
- The company has reported a net loss of $1.434 billion, resulting in an earnings per share (EPS) of -$3.95. This negative EPS suggests that the company is not profitable as of the latest reports.
- Liberty Global's gross profit margin is impressive at 67.19%, but its inability to turn revenue into net income is a concern.
3. **Revenue and Profitability Expectations**:
- Analysts have downgraded their forecasts for Liberty Global, expecting a loss of $3.64 per share in 2025. This indicates a pessimistic view of the company's profitability in the near term.
- The company's revenue forecasts for 2025 are approximately equal to the previous year's revenues, suggesting a lack of significant growth expectations.
4. **Market Conditions and Strategic Initiatives**:
- The telecom industry is competitive, and Liberty Global faces challenges in maintaining its market position and profitability.
- The company's strategic initiatives, such as mergers and partnerships, and its focus on innovation and market expansion, have been positive for stock performance. However, these factors may not necessarily translate to EPS growth if they do not lead to significant improvements in profitability.
5. **Investor Sentiment and Shareholder Returns**:
- Investors have shown confidence in Liberty Global's strategic initiatives and growth prospects, as reflected by the stock's performance and the company's buyback program.
- The company's buyback program and the recent stake acquisition by Los Angeles Capital Management LLC could signal confidence in the company's long-term prospects, but it may not directly impact EPS growth in the short term.
In conclusion, while there are some positive aspects to Liberty Global's current situation, such as a strong buyback program and investor confidence, the overall expectations for EPS growth into 2025 are not optimistic. The company's financial losses, negative P/E ratios, and analyst downgrades suggest that sustaining EPS growth will be challenging. Investors should monitor the company's strategic developments and market conditions closely.