Comcast Corporation (CMCSA) is by far the largest provider of mass media and communication services in the United States and is considered as the largest telecommunication company to extract largest revenue all over the world. Recently, Comcast has acquired NBC Universal, which has operations in broadcasting and theme parks. This recent acquisition has made Comcast even bigger and added to its revenues. For investors this means much better dividends. The stock price though hasn’t always been a favorite of the stock market and only recently has stared to pick up over the course of the past three years.
Analysts have cautiously pointed out that previously Comcast Corp Stock, which trades on NASDAQ, was overvalued, which could be because the company is doing well on paper and being praised for its financial performance.
Comcast the giant
Anyone familiar with Comcast CMCSA earnings is well aware that revenues and cash flows are in the billions of dollars. With the numbers that Comcast boasts, its not hard to see why. Comcast has 23.6 million video customers, 15.9 million high speed Internet customers, and 7.6 million phone customers. In addition to this, Comcast has earned USD 948 million in 2009 in revenues from franchise fees. Phone services contributed USD 3.3 billion in that same year due to an increase in customer base.
Mouth-watering and Appetizing Prospects for Investors
Comcast’s huge customer base means that they can tap into their already existing pool of customers. For example, if one customer is availing only TV services, the company can reach out to him by offering a high speed Internet connection at a much lower cost, or offer them a bundle for Internet, phone and TV services. The US housing economy is also an area of interest for Comcast in the sense that as more new homes are being built, new customers will require Internet and TV and phone services comcast.net.
Now, we can easily see that the effect this potential will have on Comcast Corp stock analysis is that it may send the price upwards. However, we must remain realistic as the housing market can also go busted as it did during the sub-prime mortgage crisis.
Investor and Analyst Sentiments
Investors have seen very healthy returns as CMCSA stock price has gone up 35% over the summer of 2013. An analyst at Forbes speculates that CMCSA has not always been a good stock, which is primarily because of their shares being overvalued through the 1990s to 2008. He suggests that for any good to come out of long term investing in stocks, identification of the right company to invest in and a fair or reasonable price for its stock is the right mix for better rewards.
He further goes on to state that things turned for the better when the company’s strong business combined with fair pricing of their shares converged together. After 2008, operating earnings have grown compounded at 21.5%. All of this generated long term rewards and better returns for shareholders. Despite this, the market (NASDAQ) was on a downward trend and Comcasts’ stock became undervalued, which made it affordable to newer investors.
In his own words;
“Comcast is first and foremost an above-average growth stock that now pays a dividend. Above average capital appreciation and a rapidly increasing dividend are in the cards for shareholders in the future. Leading analysts seem to agree, as the consensus of 26 analysts reporting to S&P Capital IQ forecast five years earnings growth of 18% per annum.