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Macquarie Analyst Lowers Comcast Price Target by 7%: Hold Rating Maintained

By Don Francis, Editor
May 14, 2024 9:24 AM UTC
Macquarie Analyst Lowers Comcast Price Target by 7%: Hold Rating Maintained

Macquarie's Tim Nollen lowered their price target on Comcast (NASDAQ: CMCSA) by 7% from $43 to $40 on 2024/05/13. The analyst maintained their Hold rating on the stock.

In a recent review note, Nollen stated that they had "updated media industry metrics and models as media network reporting season ends." The analyst noted that advertising trends had improved, but linear subscribers had fallen further. Pay TV subscriptions at large public cable and satellite operators declined by 10.4% year-over-year, according to Nollen.

While Nollen acknowledged that the direct-to-consumer business has provided some help, they also mentioned that there is "much more news to come." This suggests that there may be additional developments and factors that could impact Comcast's performance in the future.

Regarding Comcast's Q1 2024 earnings, the company reported earnings per share (EPS) of $1.04, beating the Zacks Consensus Estimate of $0.98 and showing a 13.9% increase compared to Q1 2023's EPS of $0.92. The company's revenue for the quarter was $30.06 billion, surpassing the Zacks Consensus Estimate by 1.12% and showing a 1.2% increase compared to Q1 2023's revenue of $29.69 billion. However, Comcast's EBITDA for the quarter was down 0.6% year-over-year, amounting to $9.355 billion.

Comcast's Chairman and CEO, Brian L. Roberts, expressed satisfaction with the company's performance in Q1 2024. He highlighted double-digit growth in adjusted EPS and free cash flow, as well as strong revenue growth in connectivity businesses. Roberts also mentioned the success of Comcast's film group and the positive trends in its streaming platform, Peacock.

In addition to the rating change for Comcast, Nollen also made changes to their price targets for other companies in their portfolio. They raised the price target on Walt Disney Co by 2.9%, from $104 to $107, while maintaining a Hold rating. Nollen also increased the price target on Fox Corp by 6.7%, from $30 to $32, while also maintaining a Hold rating.

According to WallStreetZen, 50% of top-rated analysts currently rate CMCSA as a Strong Buy or Buy, while the remaining 50% see it as a Hold. No analysts recommend or strongly recommend selling the stock.

The consensus forecast among analysts is that Comcast's upcoming year will deliver earnings per share (EPS) of $4.29. If the analysts' predictions hold true, this would represent a 13.4% increase in EPS on a year-over-year basis.

Since Comcast's latest quarterly report on April 25, 2024, the stock price has increased by 4.8%. However, on a year-over-year basis, the stock is down 1.2%. During this period, Comcast has been trailing the overall performance of the S&P 500, which has seen a decline of 26.2%.

Macquarie analyst Tim Nollen, who made the rating change on Comcast, is ranked in the bottom 6% out of 4,581 Wall Street analysts by WallStreetZen. Nollen's average return is -16%, and they have a win rate of 28.2%. The analyst specializes in the Technology, Communication Services, and Consumer Cyclical sectors.

Comcast Corporation operates as a global media and technology company. The company is divided into several segments, including Cable Communications, Media, Studios, Theme Parks, and Sky. Comcast offers a range of services, including broadband, video, voice, wireless, and advertising services through its Cable Communications segment. The Media segment operates various television and streaming platforms, including national and international cable networks, broadcast networks, and Peacock. Comcast's Studios segment is responsible for film and television production and distribution. The Theme Parks segment operates Universal theme parks worldwide. The Sky segment provides direct-to-consumer services, including video, broadband, voice, and wireless phone services. Comcast also owns the Philadelphia Flyers and the Wells Fargo Center arena in Philadelphia, Pennsylvania. The company's streaming service, Peacock, is also part of its offerings. Comcast Corporation was founded in 1963 and is headquartered in Philadelphia, Pennsylvania.

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