Time Warner Cable Inc. does not qualify for either the Enterprising Investor or the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio, insufficient earnings stability or growth over the last ten years, short dividend record, and the high PEmg and PB ratios.
We evaluated 27 different companies this week to determine whether they are suitable for Defensive Investors, those unwilling to do substantial research, or Enterprising Investors, those who are willing to do such research. We also put each company through the ModernGraham valuation model based on Benjamin Graham’s value investing formulas in order to determine an intrinsic value for each. Here’s a summary of the ModernGraham Valuations.
Time Warner Cable does not qualify for either the Defensive Investor or Enterprising Investor. The Defensive Investor has multiple concerns including the low current ratio, short dividend history, lack of stable earnings over the last ten years, and the high PEmg and PB ratios.