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Altice USA: SG upgrades to buy, targeting 28 dollars

(CercleFinance.com) - While Société Générale (SG) does not believe in Altice NV, Patrick Drahi's Dutch telecom holding company, its analysts do however like its American subsidiary, Altice USA.

Indeed, SG analysts have initiated their coverage of the US stock with a buy rating, coupled with a target price of 28 dollars.

Admittedly, like Altice NV, Altice USA is heavily indebted, although this should not last: unlike its European parent company, Altice USA should "quickly" clean up its balance sheet, as its EBITDA and cash generation are expected to increase by 10% p.a. over the next three years, SG forecasts.

Suddenlink, one of Altice USA's subsidiaries, is benefiting from strong growth and is increasing the throughput offered to its subscribers, which reduces the attrition rate. Meanwhile, another subsidiary, Optimum, is implementing savings. This comes at a time while in general, capex seem to be under control.

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