A month has gone by since the last earnings report for Comcast (
CMCSA Quick Quote CMCSA - Free Report) . Shares have added about 2.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Comcast due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Comcast’s Q4 Earnings Beat, Internet User Base Rises
Comcast reported fourth-quarter 2020 adjusted earnings of 56 cents per share, beating the Zacks Consensus Estimate by 14.3%, but decreasing 29.1% year over year.
Consolidated revenues slid 2.4% year over year to $27.71 billion but beat the Zacks Consensus Estimate by 3.5%. Cable Communication Revenue Details
Revenues increased 6.3% from the year-ago quarter to $15.71 billion. Total Customer Relationships increased 455K to 33.14 million.
High-speed Internet revenues grew 12.7% year over year to $5.40 billion, primarily driven by increased residential high-speed Internet customers and average rate. Total high-speed Internet customer net additions were 538K. Business Services revenues were up 4.8% to $2.10 billion, driven by customer-base expansion and higher average rates. Wireless revenues jumped 35.8% to $505 million, supported by an increase in the number of customer lines. Comcast added 246K wireless lines in the reported quarter. Advertising revenues increased 33.8% year over year to $935 million, primarily driven by an increase in political advertising revenues. Voice revenues were $880 million, down 6.8% year over year due to a declining number of residential voice customers. Video revenues slipped 0.7% to $5.47 billion, reflecting a decline in the residential video customer count. Total video customer net losses were 248K while total voice customer net losses were 24K. Other revenues decreased 7.5% from the year-ago quarter to $421 million, owing to lower security and automation services revenues as well as waived late fees. NBCUniversal Revenues Decrease Y/Y
Revenues declined 18.1% year over year to $7.50 billion.
Cable Networks’ revenues dipped 6.4% from the year-ago quarter to $2.74 billion. Broadcast Television revenues decreased 12% from the year-ago quarter to $2.78 billion. Filmed Entertainment revenues decreased 8.3% from the year-ago quarter to $1.43 billion. Theatrical revenues fell 70% from the year-ago quarter. Theme Parks revenues were $579 million, down 62.9% year over year. Universal Orlando Resort and Universal Studios Japan operated with limited capacity, while Universal Studios Hollywood remains closed. Sky Revenue Details
Sky’s revenues increased 3.3% year over year to $5.21 billion. At constant currency (cc), revenues declined 0.9%.
Direct-to-consumer revenues were up 1.4% (down 2.8% at cc) from the year-ago quarter to $4.08 billion. Content revenues increased 14.8% (up 10.4% at cc) to $426 million. Advertising revenues climbed 8.5% (up 3.9% at cc) from the year-ago quarter to $702 million. Total Customer Relationships increased 244K to 23.939 million in the reported quarter. Operating Details
Consolidated programming & production costs increased 1.5% from the year-ago quarter to $9.44 billion.
Consolidated adjusted EBITDA fell 14.8% from the year-ago quarter to $7.19 billion. Segment-wise, Cable Communications’ adjusted EBITDA rose 12.3% from the year-ago quarter to $6.61 billion. Cable Communications results include a loss of $60 million from the wireless business compared with a loss of $116 million in the year-ago quarter. NBCUniversal’s adjusted EBITDA decreased 20.7% from the year-ago quarter to $1.60 billion, reflecting a significant decline in Theme Parks (down 102.3%) and Broadcast Television (down 24.3%), partially offset by growth in Cable Networks (up 22.4%) and Filmed Entertainment (up 65.2%)-adjusted EBITDA. Sky’s adjusted EBITDA declined 81.8% year over year (down 82.3% at cc) to $139 million. Notably, Sky’s operating costs and expenses increased 18.5% (up13.4% at cc) to $5.07 billion. Consolidated operating income declined 25.3% year over year to $3.92 billion. Cash Flow & Liquidity
As of Dec 31, 2020, cash and cash equivalents were $11.74 billion, down from $13.71 billion as of Sep 30, 2020.
Moreover, as of Dec 31, 2020, consolidated total debt was $103.76 billion, compared with $104.42 billion as of Sep 30, 2020. In fourth-quarter 2020, Comcast generated cash from operations of $5.04 billion, down 19.1% year over year. Free cash flow was $2.29 billion in the reported quarter, down 31.6% year over year. Dividends paid out in 2020 were worth $4.1 billion. Comcast increased dividend by 9% year over year to $1 per share. How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month.
Currently, Comcast has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Comcast has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.