Banc of America Cuts Charter Communications to 'Buy'
Banc of America downgraded Charter Communications (CHTR ) to buy from strong buy.
On Monday CEO Jerry Kent resigned, prompting analyst Douglas Shapiro to downgrade the stock. Shapiro says despite the stock's 20% drop Monday, he downgraded on Tuesday, saying he thinks there's a substantial uncertainty about the stability of the remaining management team.
Shapiro says while stock's valuation is attractive, he doesn't think it's so compelling on a relative basis that it outweighs the added risk. He notes the positive stance on the group is unchanged, and he still expects Charter to outperform the sector if the group benefits from rotations; but with added uncertainty he's no longer comfortable with his strong buy rating.
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