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Comcast (CMCSA) Meets Q3 Earnings Tops Revenues, Shares Up

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Comcast Corp. (CMCSA - Free Report) is the largest cable MSO (multi service operator) in the U.S. and a leading media and entertainment company.  Comcast provides basic video, digital video, high-speed broadband (Internet) and telephony services to individuals and business enterprises. In addition the company provides filmed entertainment, cable networks, broadcast TV services and operates theme parks. 

Comcast's decision to venture into the U.S. wireless space bodes well with its diversified business model. The company is also participating in the ongoing 600 MHz wireless spectrum auction in the U.S. Comcast’s Cable business is doing well and the NBC Universal segment is also witnessing significant improvement. Recently, NBC Universal purchased DreamWorks Animation for $3.8 billion and has also earned $250 million in profits from its Rio Olympics coverage of 2016.

However, intensifying competitive threat, consolidation-related woes, mounting programming costs and a highly leveraged balance sheet are potent headwinds. Quarterly operating costs and expenses totaled $12,814 million in the second quarter of 2016, up 2.7% year over year which implies a rise in the rate of programming expenses in 2016. Moreover, loss of NBC Universal’s programming distribution agreements, or the renewal of these agreements on less favorable terms, could affect its businesses.

Comcast currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The company has generated a positive average earnings surprise of 1.58% in the previous four quarters. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings:  Comcast Meets Q3 earnings estimate. Our consensus earnings estimate called for an adjusted EPS of 92 cents and the company reported exactly the same number. Investors should note that these figures take out stock option expenses.

Revenue:  Comcast reported total revenue of $21,319 million surpassing our estimate by $141 million.

Key States to Note:   In the reported quarter, Comcast gained 32,000 video customers. At third-quarter 2016 end, the company had 22.428 million video subscribers, up 0.8% year over year. Quarterly high-speed broadband customer addition was 330,000. At third-quarter end, the company had 24.316 million high-speed Internet subscribers, up 6.3% year over year. The company also added 2,000 voice customers. At third-quarter end, the company had 11.643 million voice subscribers, up 2.7% year over year.

Stock Price:  At the time of writing, the stock price of Comcast was up nearly 0.74% in the pre-market trade on Nasdaq. Clearly the initial reaction to the release is positive. The company witnessed a significant gain in video customer and massive increase in high-speed Internet customer year over year. We believe these strong results are the primary reasons for this initial positive sentiment.    

Check back later for our full write up on this Comcast earnings report later! 

COMCAST CORP A Price and EPS Surprise

 

COMCAST CORP A Price and EPS Surprise | COMCAST CORP A Quote

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