Comcast Corporation | $CMCSA Stock | Shares Plunge on News of Sky Takeover Bid


Comcast Corporation (NASDAQ: CMCSA)


Comcast shares fell in Tuesday trading following the news that the cable TV giant plans to place a $31 billion bid to take over Sky Networks. By mid-afternoon on Tuesday, shares of Comcast had fallen to the $37.10 range, a 6 percent drop. Comcast and Twenty-First Century Fox are in a bidding war over Sky Networks which is based in Europe.

However, Comcast investors seem not to be embracing the rough takeover attempts. Comcast’s offer to take over Sky Networks puts much pressure on Fox to raise the price it initially reached with Sky in 2016 to acquire it.

CMCSA Earnings & Outlook

Wall Street predictions seem to be pessimistic based on Comcast’s recent earnings update. Analysts predict that profits of the cable TV giant will drop by 48.38% in 2019 relative to a five-year average of a growth rate of 16.70%.

Presently, with the company’s earnings standing at $22.17 billion, they should be expected to fall to $11.72 billion by next year. From the current 22.71 billion net income level and $13.72 billion final forecast by 2021, the yearly rate of growth for the Comcast’s earnings is -20.56%.

EPS reaches $3.17 in the final year forecast when compared to the current $4.81 EPS. The decline seems to be as a result of top-expansion of 4.47%, which analysts predict will lag cost growth heading to 2021. Margins are expected to contract from 26.86% to 14.03% by the end of 2021.

Comcast’s CEO Comments

Comcast CEO Brian Roberts believes Sky is “an outstanding company” that would enhance the presence of Comcast globally. “We think that Sky will be very valuable to us as we aim to focus our presence all over the world. Comcast already has a strong presence in London and Sky would be a great platform for growth in Europe,” Roberts said.

Comcast Corporation Company Profile

Incorporated on December 7, 2001, Comcast Corporation is a technology and media company. The Company operates two primary businesses: NBCUniversal and Comcast Cable. Its Comcast Cable business operates the Cable Communications segment.

The company’s NBCUniversal business operates four business segments: Broadcast Television, Cable Networks, Theme Parks and Filmed Entertainment. Comcast’s other business interests comprise primarily of Wells Fargo Center arena in Philadelphia, Pennsylvania and Comcast Spectacor that runs the Philadelphia Flyers.

Comcast Cable provides video, voice and high-speed Internet services to residential and business customers. The Company also offers its automation and home security services as part of its bundled service offerings. Comcast’s video services include programming availed by local broadcast stations, national broadcast networks, and regional and national cable networks, as well as public and government access programming.

Its video services give customers access to its video on demand service and an interactive program guide. As of 2016, its Comcast On Demand service offered video customers over 100,000 programming picks over the course of one month, including about 40,000 in HD.

Its HD video service offers customers high-resolution picture quality, a wide-screen format through a HD set-top box, and improved audio quality. The Company competes with DISH Network Corporation, CenturyLink Inc., Verizon Communications Inc., Frontier and Time Warner Inc. Its head offices are in Philadelphia, PA. –CNN