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Behind Comcast's Strategy for Long-Term Growth

PART:
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Part 4
Behind Comcast's Strategy for Long-Term Growth PART 4 OF 7

Understanding Comcast’s $5-Billion Share Repurchase in 2017

Fiscal 2017 target

Comcast (CMCSA) continues to enhance shareholders returns through huge share buybacks, and the company plans to finish 2017 with a share repurchase worth $5 billion.

Understanding Comcast&#8217;s $5-Billion Share Repurchase in 2017

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In 3Q17, Comcast bought back $1.7 billion in shares, compared with $1.4 billion in 3Q16. It has maintained an average of $1.3 billion in share buybacks every quarter.

By the end of first nine months of 2017, the company had spent $4.2 billion in share repurchases, compared with $4 billion during the same period of 2016. Comcast thus anticipates that it will buy another $800 million in shares to complete its annual quota of $5 billion.

But despite its big buybacks, the company still had $8.2 billion left in its repurchase program authorization on September 30, 2017.

Comcast’s history of buybacks

Comcast bought back shares worth $5 billion in 2015, $6.75 in 2016, and $4.25 billion so far in 2017, for an average of $5.3 billion. The company purchased 81 million, 116 million, and 81 million shares, respectively, during those three years, for an average of 92.7 million per year.

Despite its huge capital expenditure, Comcast has been able to maintain a healthy free cash flow. Its free cash flow at the end of the first nine months of 2017 stood at $7.6 billion. Over the past three years, it has maintained an average free cash flow of nearly $10 billion.

By comparison, media giant Walt Disney (DIS) bought shares worth $7.5 billion in 2016, which is 50% higher than Comcast. CBS (CBS) and Time Warner (TWX) bought shares worth $3 billion and $2.1 billion, respectively, during the same period, which is lower than Comcast.

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