Comcast (NASDAQ: CMCSA)
Quality Value Investing Research Report | Updated Coverage | February 2024
Summary:
Comcast Corporation was added to the Quality Value Investing (QVI) Concentrated Real-Time Stock Picks in January 2018 as a contrarian media long play in a short-sighted market.
Management still performs strongly in profit margins and shareholder value. However, growth is moderate, returns on invested capital are below its cost, and enterprise downside risks are average at best.
On the contrary, QVI’s value analysis shows that Comcast’s shareholder yields outperform the Treasury benchmark, valuation multiples are compelling, and share price risks are low.
Although market sentiment is consensus bullish on the stock, my latest analysis asks, “Do Comcast investors need more patience, or was it a good idea at the time?”
Access your Quality Value Investing (QVI) Glossary of Investing Terms and Metric Targets when referencing this research report. Unless noted, all data presented is sourced from Seeking Alpha Premium as of the market close on February 9, 2024, and intended for illustration only.
The 43 holdings in the QVI Real-Time Stock Picks portfolio have collectively achieved alpha for 15 years by focusing research and analysis on a company’s current wealth and its share price’s present value. In other words, just the facts without unreliable predictive analysis typical of the buy side or the business modeling overkill of the sell side Wall Street analysts.
In this updated QVI Research Report, we’ll look at the Concentrated Real-Time Stock Picks communications services sector holding Comcast Corporation to see if it continues to meet Quality Value Investing’s active portfolio inclusion criteria based on our checklist analysis of the business’s current wealth and its stock’s present value.
Comcast: Company Current Wealth
To uncover the current wealth of the company, QVI defines the value proposition, measures returns on management, and assesses enterprise downside risks.
Value Proposition
QVI Research Report’s value proposition section provides a brief synopsis of the company’s business model, major exchange listing, stock symbol, market capitalization, and dividend-paying status. In addition, it defines the competitive advantages of a company’s products or services to its customers compared to the industry, including the stock’s historical performance vs. the sector and market.
Comcast CMCSA 0.00%↑ is a dividend-paying large-cap stock in the communications services sector’s cable and satellite industry. CMCSA was added to the QVI Concentrated Stock Picks on January 10, 2018, at a split and dividend-adjusted $35.76 a share.
Comcast Corporation operates as a media and technology company worldwide. It operates through Residential Connectivity & Platforms, Business Services Connectivity, Media, Studios, and Theme Parks segments.
The Residential Connectivity & Platforms segment provides residential broadband and wireless connectivity services, residential and business video services, sky-branded entertainment television networks, and advertising.
The Business Services Connectivity segment offers connectivity services for small business locations, which include broadband, wireline voice, and wireless services, as well as solutions for medium-sized customers and larger enterprises; and small business connectivity services in the United Kingdom.
The Media segment operates NBCUniversal’s television and streaming business, including national and regional cable networks; the NBC and Telemundo broadcast networks and owned local broadcast television stations; and Peacock, a direct-to-consumer streaming service. It also operates international television networks comprising the Sky Sports networks, as well as other digital properties.
The Studios segment operates NBCUniversal and Sky film and television studio production and distribution operations.
The Theme Parks segment operates Universal theme parks in Orlando, Florida; Hollywood, California; Osaka, Japan; and Beijing, China.
The company also offers consolidated streaming platforms under the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania, and Xumo.
Comcast Corporation was founded in 1963 and is headquartered in Philadelphia, Pennsylvania, USA.
QVI’s value proposition elevator pitch for Comcast:
Comcast spans the entire media complex, producing content at NBC Universal and then delivering content via Xfinity, Peacock, and Sky. Now that’s an empire.
Due Diligence Resources
For a more in-depth analysis of the all-important value proposition, visit Comcast’s investor relations webpage and its most recent Form 10-K Annual Report submitted to the US Securities and Exchange Commission or SEC.
Performance vs. Sector and Market
The chart below illustrates Comcast’s performance against the Communications Services Select Sector SPDR® Fund ETF (NYSE: XLC) and the SPDR® S&P 500 ETF Trust (NYSE: SPY) since being added to the QVI Concentrated Real-Time Stock Picks on January 10, 2018.
After outperforming its sector and the broader market for the first three and half years of Quality Value Investing’s coverage, CMCSA has underperformed overall during the six years of ownership.
In the QVI Concentrated stock picks, CMCSA has underperformed the S&P 500 by -6,478 basis points (bps) since inception.
QVI’s value proposition rating for Comcast: Neutral.
Next, we’ll look at the company’s returns on management and enterprise downsize risks, the share price’s present value, and the investment thesis, each exclusive to Quality Value Investing’s premium (paying) subscribers.
Disclosure: At the time of this writing, I/we had a beneficial long position in the common shares of CMCSA in our family portfolio. I wrote this report myself, and it expresses my own opinions. I am not receiving compensation for it other than from Substack paid subscriptions. I have no business relationship with any company whose stock is mentioned in this post.