Piotroski’s Best and Worst Large Cap Stocks

By Joel Stonington - 2011-12-06T01:37:02Z

Photograph by Jonathan Fickies/Bloomberg

3 of 19

Piotroski's Best: Time Warner Cable

Business: Offers television, Internet and voice services.

Piotroski Score: 9

Time Warner Cable (TWC) scored highly on the Piotroski screen, partly because of its operating cash flow. In its latest fiscal year, 2010, operating cash flow of $5.22 billion exceeded its net income of $1.31 billion.

Outlook for the Company:

Bull Case: Because of triple play (video, data, voice), cable companies can now generate more revenue from higher-margin businesses such as data and voice, says Bloomberg Industries. Mike McCormack, an analyst with Nomura Securities, says Time Warner's free cash flow per share should rise next year.

Bear Case: Cable companies face rising competition from video services such as Netflix, Hulu and YouTube, says Bloomberg Industries.