Morgan Stanley Remains Bullish On Comcast

Comcast Corporation CMCSA remains worth watching.

The Analyst

Morgan Stanley’s Benjamin Swinburne reiterated an Overweight rating on Comcast with a $46 price target.

The Thesis

Swinburne believes a continuing expansion in broadband will offset declines in video. And, the company’s Britain-based Sky Network should help drive EBITDA growth, with lower costs for televising the English Premier League soccer league in the next two years.

But underlying everything is the fundamental core business, he said.

Swinburne noted that as Comcast pursued Fox and Sky last year, investors seemed to forget about the fundamental performance of the company’s core cable TV business and its NBC assets.

“Fortunately, the healthy performance of these businesses last year has continued into 2019, and we remain confident in our outlook,” Swinburne wrote in a Tuesday note to investors.

Morgan Stanley believes Comcast’s NBCU should benefit from a strong ad market and healthy slates of films in 2019 and 2020.

Swinburne also said Verizon Communications Inc. VZ's plans for home 5G service “have had no discernible impact to cable broadband results or expectations, including Comcast.”

Price Action

Comcast traded around $40 per share at time of publication.

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Photo courtesy of Comcast.