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Comcast is a behemoth of a company with cable lines, content , and Universal Studios
Their major moat has been in licensing that spans all 3 three.
**Cable**
Let’s start with Cable Lines.
The negative factor for Comcast has been cord cutting from hundreds of thousands of customers.
Fiber buildout for the last 10+ years has reduced the coaxial line infrastructure for many years and has left Comcast with smaller market share but holding its Last mile infrastructure.
The next threat is Starlink taking over internet from anywhere, leaving Comcast’s infrastructure worthless. The thing is Starlink is not only slow compared to wifi and not sure that you would want to watch the Super Bowl on that level of tech.
but Comcast made an enterprise deal with Starlink 2 years ago making that partnership could be a very powerful duo. There hasn’t been any new info on what they would do together but it is an interesting convergence. Overall it’s a threat that will play out over time.
And new fiber buildout will continue to erode the Comcast’s service.
**Content & Media**
Ok now Content
They spun of Versant taking away CNBC, USA Network, MS NOW (ex-MSNBC)
which has an amazing fan base yet unlocked a ton of value in to the market.
Their conglomerate was once a moat itself but now their size is preventing theme from focus and speed so it makes a lot of sense that they are now spinning off nbc universal.
That will unlock a ton of value and allow each major part of the company to stand on its own. To me nbc universal seems like a Disney knock off but when I remember going to Disney they didn’t have the characters that I wanted to see because universal owns the theme-park rights to characters like Spiderman and some others marvel heroes that Disney cant put in their parks!
Their content on peacock is clearly desirable and they have been pushing it through an apple and Xfinity partnerships. Their licensing for the NFL, FIFA, the olympics and WWE content.
Bottom line the reason millions of customers won’t cut from content is the deep need for football and sports men are not giving up their sports for inferior products. If it is was just about the wires they would. Because customers hate Comcast, they’ve told me.
Last but not least their media devoid of Sky is purchasing ITV entertainment for 1.6 billion and should close in 2027 expanding significantly into the UK market. That is a beautiful pairing with their UK park that they are opening as well.
**Parks**
And… universal studios
Universal obviously has lots of parks but their newest one opened in Frisco, Texas this summer. with a 32-acre theme park, designed specifically for families with young children (ages 3 to 8).
And now they are investing 8 billion into opening a park in the UK by 2031, a 476-acre site in Bedfordshire, about 45 miles north of London.
These two additional parks move them to 7 from 5 spanning from California, Florida, Japan, china, and Singapore.
The growth will be reflected in the next few quarters. But is being over shadowed by cable cording cutting across the US.
Now they are talking about spinning off NBCuniversal from Comcast. That seems like it will unlock hidden value across these three massive businesses. Although I’m not mentioning metrics here I see Comcast as 2-3X undervalued but that is in total, nbc universal itself may be undervalue more.
Everyone I talk to hates me for mentioning this stock because it’s not exciting like the tech sector.
**Graham Checklist from HETY** 7/7
|Adequate size|Comcast's market cap of $84.00B clears Graham's $2B minimum — large enough to be an established, resilient business.|Passed|
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|Low Debt to Equity|Comcast runs a debt-to-equity of 1.01, under the 1.1 ceiling — it doesn't owe much more than it owns, so the balance sheet is sound.|Passed|
|Earnings Stability|Comcast has stayed profitable with 10-yr avg earnings growth of 32.6% — no collapse, a sign of a durable business.|Passed|
|Dividend History|Comcast pays a dividend (yield 5.6%), returning real cash to shareholders — a hallmark of a mature firm.|Passed|
|Earnings Growth|Comcast's 10-yr avg earnings growth of 32.6% clears the 3% bar — the business is genuinely expanding, not treading water.|Passed|
|Moderate P/E|Comcast trades at a P/E of 7.7, under 15 — you're not overpaying for each dollar of profit.|Passed|
|Moderate P/B|Comcast's price-to-book of 0.94 is under 1.5 — there's real asset value backing the share price.|Passed|