The Zacks Analyst Blog Highlights: Comcast, Time Warner Cable, Charter Communications, Netflix and TASER International

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Jan 10, 2014, 09:30 ET

CHICAGO, Jan. 10, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Comcast Corp. (Nasdaq:CMCSA-Free Report), Time Warner Cable Inc. (NYSE:TWC-Free Report), Charter Communications Inc. (Nasdaq:CHTR-Free Report), Netflix Inc. (Nasdaq:NFLX-Free Report) and TASER International Inc. (Nasdaq:TASR-Free Report).

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Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Thursday's Analyst Blog:

A Mixed Bag for Cable MSOs

The recently concluded fourth quarter of 2013 has turned out to be mixed for the two largest cable TV operators in the U.S.

Comcast Corp. (Nasdaq:CMCSA-Free Report), the largest cable TV operator, has surprised the market with the claim of modest growth in its video subscriber base in the fourth quarter of last year. Notably, the segment has seen growth after six years. In the year-ago quarter, Comcast lost 7,000 video subscribers.

On the other hand, Time Warner Cable Inc. (NYSE:TWC-Free Report), the second largest cable TV operator, lost 215,000 video subscribers in the fourth quarter of 2013. In the year-ago quarter, the company lost 129,000 video subscribers. For full-year 2013, Time Warner cable lost a massive 825,000 video customers compared with a loss of 530,000 customers in 2012. Clearly, video operation has become a major concern for the company.

Meanwhile, the cable TV industry in the U.S., is on the verge of consolidation. 2014 may witness several game changing decisions and activities in this industry.

Currently, Charter Communications Inc. (Nasdaq:CHTR-Free Report), the fourth largest cable TV operator, is aggressively pursuing its bid to acquire Time Warner Cable. Industry sources revealed that Comcast and Cox Communications are also in the fray for the company.

In the U.S., the cable MSOs (multi service operators) are gradually losing hold in the pay-TV market globally. Internal dynamics of the pay-TV market is slowly shifting toward fiber-based video offerings of large telecom and satellite TV operators.

In addition, low-cost online video streaming service providers such as Netflix Inc. (Nasdaq:NFLX-Free Report) have become major competitive threats. Video offering is the core business area of cable TV operators, which is slipping out of their hands.

Currently, Netflix sports a Zacks Rank #1 (Strong Buy), while both Comcast and Time Warner cable have a Zacks Rank #2 (Buy) and Charter Communications has a Zacks Rank #3 (Hold).

Taser Jumps as Orders Flow In

TASER International Inc.'s (Nasdaq:TASR-Free Report) share price jumped almost 13% on Wednesday, Jan 8, on the back of a slew of orders received at the end of 2013. The company's share price touched $18.57 yesterday, the highest not only in 52 weeks but even in more than six years.

The company, in its latest update on stun-gun sales, revealed that it has booked numerous new orders for its TASER brand conducted electrical weapons (CEWs) and its next generation Smart Weapons. The company had shipped most of the orders in the fourth quarter of 2013 with the balance to be delivered in the first quarter of 2014.

Although TASER did not disclose the financial details of these sales, their value is expected to climb over $4.0 million as gauged from the advertised list prices.

TASER is seeing increasing uptake on the back of its new Smart Weapons platforms, as customers are eager to follow this market transition. The majority of these orders were for its next-generation electroshock Smart Weapons, which totaled over 5,000 from local, state and federal agencies. The company's new Smart Weapon platforms offer significant improvements in safety, effectiveness and accountability. As many as 13 clients have ordered new TASER weapons while 29 agencies are already deploying the TASER SMART weapons.

In addition, the company's international customers, though not specified by TASER, have placed orders for 260 units of TASER's X2 Smart Weapons, and 1,538 TASER X26s. The company also made small-ticket sales of X2s, X26Ps, and TASER CAM HDs with orders of less than 20 units each.

TASER invests considerably in upgrading existing and producing new products that make life safer in public places. During the third quarter, the company invested $2.4 million in research and development expenses, up 22.9% from the year-ago comparable period.

Investors have reacted positively to TASER's latest order update with demand expected to sustain through 2014. With a trailing twelve-month Price-to-Earnings (P/E) of 55.34, a close watch on the stock is warranted to see if this recent strength is sustainable.

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