Comcast's Market Valuation Does Not Reflect Fair Value For It's Significant Growth Portfolio: Analyst

Benchmark analyst Matthew Harrigan reiterated Comcast Corp CMCSA with a Buy and a $55 price target.

Dan Lovinger, NBC's president of ad sales and partnerships, announced that NBCU has already won $1.2 billion in commitments, on pace for a record Olympic tally including more than $350 million from new advertisers. 

The analyst said the amount of commitment won is already just marginally behind the $1.25 billion in national advertising achieved for the Tokyo Games.  

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The Olympics are especially integral to Peacock's ongoing momentum, with all events streaming with record concomitant digital advertising.  

As per Harrigan, all inventory for the opening and closing ceremonies has now been sold out. 

Top categories include nonalcoholic beverages, CPG, financial services, and retail, with entertainment also advancing. 

He reflected on NBCU's partnership emphasis and said that nearly 95% of individual primetime marketing integrations are sold out.  

The high affinity for major brands seeking association with the Olympics attests to Comcast's savvy off its own $7.65 billion Olympic commitment through 2032, with ad spending currently up 18% from the 2021 Tokyo Games in a less favorable Asian time zone with spectators returning in Paris, as per Harrigan. 

This year's Olympic ratings will also likely benefit from breakout interest and viewing for women's sports following the NCAA Basketball Tournament. 

The current market valuation does not reflect fair value for the company's significant growth portfolio and the essential relevance of linear TV integrated with streaming for delivering client brand equity, as per the analyst leading to the re-rating.   

Harrigan noted that Peacock is creating a new inventory from on-demand and live-stream shows and new programmatic offerings.

The programmatic alternative is fostered through a partnership with The Trade Desk, enabling a private biddable marketplace. NBCU also has agreements to post clips on X and Snapchat. 

The analyst writes that NBCUniversal is an overall leader in cross-platform advertising and AdTech, including its One Platform Total Audience approach, which has broad industry adoption, notably integrating linear viewing with digital consumption data.

One Platform includes significant NBCUniversal AI-enabled planning and activation technology. Near 60% of NBCUniversal's advertising clients use audience-based buying to maximize value, with a plus 25% growth in strategic audience-dedicated advertising, as per Harrigan.  

Comcast gained 4% in the last 12 months. Investors can gain exposure to the stock via Invesco BuyBack Achievers ETF PKW and Invesco S&P 500 Equal Weight Communication Services ETF RSPC.

Price Action: CMCSA shares traded lower by 1.22% at $39.66 on the last check Wednesday.

Comcast Peacock Photo by rarrarorro on Shutterstock