Report: Comcast Might Sell Hulu Stake To Disney

Walt Disney Co DIS already owns a majority stake in Hulu and is in talks with Comcast Corporation CMCSA to buy its 30-percent stake, CNBC reported.

What Happened

Comcast's stake in  Hulu has been a "frustrating" experience and is exploring a sale of its ownership, sources told CNBC. Comcast is evaluating the sale of its stake to Disney but Comcast CEO Brian Roberts told CNBC it has "no new news today" other than stating it remains a "really valuable asset." He also said he is "really glad" to own a large stake in Hulu.

Morgan Stanley's Simon Flannery said in an April 16 research report Comcast's ownership of Hulu contributed a $454-million loss.

Why It's Important

Comcast is the parent company of NBC, which CNBC said accounts for around 17 percent of Hulu's total content. NBC has no desire to remove its content from Hulu while showcasing the same content on its own streaming platform.

Comcast's minority ownership implies decisions made at Hulu won't necessarily align with its own strategic plans, CNBC said. Comcast could walk away from a sale with $4.5 billion, which would support its dividend payout.

On the other hand, Comcast may want to hold on to its stake despite near-term losses if it believes Hulu's current valuation has upside potential from its current $15 billion.

CNBC's sources stressed there is no guarantee at all a deal will transpire.

Related Links:

What Wall Street Is Saying About Disney+

Why Strong Subscriber Growth for Hulu, Netflix Bodes Well For The Sector

Photo courtesy of Hulu.