Can Comcast Stock Make a Smooth Recovery?

In 2022 CMCSA has fallen in price by 7.5%

facebook twitter linkedin


Comcast Corporation (NASDAQ:CMCSA) recently announced that Brian Roberts, Chairman and Chief Executive Officer of Comcast Corporation, will participate in the Morgan Stanley Technology, Media & Telecom Conference in San Francisco, California on Monday, March 7.

The stock has gone by way of the broader market, shedding 7.5% in 2022, with an even more severe 18% year-to-date defect. The security found itself coming to blows with its 60-day moving average in January, logging just one close north of here since its September peak. What's more, CMCSA hit an annual low of $44.27 just two sessions prior. 

cmcsa feb 28

Analysts remain optimistic. Of the 17 in coverage, 12 say "buy" or better, compared to four "sell" or worse ratings. Plus, the 12-month consensus price target of $61.90 is a 33.2% premium to current levels. 

Options traders have taken a much more bearish stance. The stock sports a 10-day put/call volume ratio of 2.70 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 97% of annual readings. In other words, there's been an unusually healthy appetite for long puts among options players of late. 

Nonetheless, Comcast stock offers a decent valuation and a solid a dividend yield of 2.29% with forward dividend of $1.08, making it a relatively safe option for long-term investors. The only real fundamental downside for CMCSA is its balance sheet, which holds $8.7 billion in cash and $107.3 billion in total debt.

The media and tech company has had significant progress with its top- and bottom-lines in recent years, despite experiencing a 5% drop in revenues and a 19% decline in net income in fiscal 2020. Since fiscal 2020, Comcast has increased its annual revenues and net income 12% and 34%, respectively. In addition, CMCSA's annual revenues and net income are up 23% and 21%, respectively, since fiscal 2018. Analysts expect that the media and tech company will grow revenues by 2% and earnings by 12.1% for fiscal 2022, making Comcast stock an all-around solid conservative stock pick.

 




 
Special Offers from Schaeffer's Trading Partners