Comcast Corp (NASDAQ:CMCSA) shares are trading lower fell Friday morning as investors digest a disappointing earnings report from its closest peer, Charter Communications Inc (NASDAQ:CHTR).
What To Know: The results painted a picture of an industry grappling with intense competition and slowing growth, casting a shadow over Comcast’s own upcoming financial release.
Charter's report contained several red flags for the cable sector. Most notably, the company lost another 117,000 internet subscribers in the second quarter.
While this was an improvement over last year’s loss, it confirms that the threat from fiber and 5G fixed wireless access continues to erode the cable industry’s crucial broadband business. Investors are concerned Comcast is facing the same competitive pressures.
Furthermore, Charter missed analyst expectations for profitability, with earnings per share of $9.18 falling short of the $9.80 consensus estimate. A year-over-year decline in free cash flow from $1.3 billion to $1.1 billion, coupled with continued video subscriber losses, amplified concerns.
Because Comcast and Charter dominate the U.S. cable market and face similar headwinds, Charter’s performance is often seen as a bellwether for the industry. The weak results are leading investors to sell off Comcast stock in anticipation of similar challenges.
Traders and investors will be watching for Comcast’s second-quarter financial results, confirmed for Thursday, July 31 after the market close. According to data from Benzinga Pro, CMCSA is expected to report EPS of $1.17 on revenues of $29.8 billion.
Benzinga Edge Rankings: According to Benzinga Edge stock rankings, Comcast presents a mixed profile. The company scores very well on Growth, with a rating of 75.85, and also shows strong fundamentals with a Quality score of 65.43. These figures point to a fundamentally healthy company with a solid growth trajectory.
However, these strengths are sharply contrasted by a weak Momentum score of 29.41, reflecting the stock’s recent negative price performance. Its Value score of 44.16 is moderate, suggesting that while not excessively expensive, the stock may not be considered a deep bargain at its current valuation.
Price Action: According to data from Benzinga Pro, CMCSA shares are trading lower by 5.3% to $33.49 Friday morning. The stock has a 52-week high of $45.31 and a 52-week low of $31.44.
How To Buy CMCSA Stock
By now you're likely curious about how to participate in the market for Comcast – be it to purchase shares, or even attempt to bet against the company.
Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy “fractional shares,” which allows you to own portions of stock without buying an entire share.
In the case of Comcast, which is trading at $33.49 as of publishing time, $100 would buy you 2.99 shares of stock.
If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to “go short” a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading – either way it allows you to profit off of the share price decline.
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