The shares of media and engineering organization Comcast (NASDAQ:CMCSA) have declined in 2014. Comcast had a mixed performance prior with the decline in revenue yet earnings stayed level. Still, the organization is developing strongly and seems, overall, positioned to convey solid long haul development.
We should investigate in detail the fiscal performance of Comcast and figure out if conditions are positive for development over the long haul or investors should consider purchasing some other stock instead.
Comcast is very sure about its solid viewpoint with huge numbers of its segments such as link communications, link networks, broadcast television, shot stimulation and amusement park developing robustly in sales.
The quantity of customers for feature, fast web and voice in the final quarter of 2013 arrived at 649,000 which is a 29% increase from the same quarter the previous year. Comcast has a robust possibility of performing admirably in the impending quarters with such a solid customer base.
- Warning! GuruFocus has detected 4 Warning Signs with CMCSA. Click here to check it out.
- CMCSA 15-Year Financial Data
- The intrinsic value of CMCSA
- Peter Lynch Chart of CMCSA
The triple play strategy of Comcast is expected to convey this positive energy to fiscal 2014 as well. The triple play strategy comprises television, web and telephone, which have all experienced robust development for the past year because its users are using separate products.
As indicated by administration, nearly 79% of feature customers for Comcast requested extra two products and 44% of its new customers profited for all the three services amid the final quarter. By and large, the organization included 1.3 million new customers in the final quarter which marks eight consecutive quarters of including more than 1 million new customers. Comcast is right now set to increase the estimation of the triple play strategy with robust strategic investments to drive constant development.
Further, in the second a large portion of 2013 Comcast had propelled X1 boxes and wireless passage services which is a piece of the triple play strategy. The X1 boxes are dispatched with an extensive variety of substance choices and several quality-included services as well. Additionally, the organization is witnessing robust customer interest for its feature on interest (VOD) service.
Comcast has plans to increase the spending on X1 boxes as it is currently accessible in all markets, and the organization focuses on arriving at more customers. It also has plans to convey extra wireless gateways to further advance customer experience by giving the fastest in-home Wi-Fi experience and by increasing system limit.
Also, Comcast signed a concurrence with Netflix (NFLX) to permit immediate access of its broadband system that is expected to enhance speed. Comcast is relied upon to enhance its profitability through the activity as Netflix's customers will experience great speed and faster review taking into consideration more subscriptions.
Comcast has increased its dividend by 15% because of witnessing robust growth across all its businesses. For the following couple of years, the organization has also raised its stock repurchase program approval to $7.5 billion.
Thus, investors can profit 30% increase in capital returns because of these moves. In addition, Comcast illustrated 8.3% increase in operating cash stream coupled with 6.9% increase in free cash stream in 2013 empowering the organization to keep returning cash to shareholders. Alongside a robust PEG degree of 0.94, Comcast appears a promising long haul pick with being undervalued in respect to its normal development.
Comcast shares are underperforming this year; still the organization is generally positioned to arrive at new highs going ahead since witnessing development across the board. Also, the administration is investor cordial alongside the appealing valuation which makes Comcast a decent pick for the portfolio.