Phone Push Could Dampen Cox Growth


CS First Boston Corp. cable analyst Lara Warner maintained her "neutral" rating on Cox Communications Inc., but warned that efforts to accelerate cable-telephony penetration could hurt the MSO's overall growth rates. In a report, Warner estimated telephony would account for about 20 percent of revenue growth and 25 percent to 30 percent of cash-flow growth over the next five years. But with increasing competition in local markets — particularly from AT&T Corp. and MCI — "acceleration in revenue and [cash-flow] growth, and significant margin expansion will be difficult," Warner wrote. She didn't change her 12-month price target on the stock ($29), saying she expected increases in high-speed data pricing could offset the changes in her telephony forecast.