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What Do Comcast’s Valuation Multiples Suggest?

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Comcast’s scale

On May 17, Comcast (CMCSA) had a market cap of ~$149.1 billion compared to its peers Netflix (NFLX) and the Walt Disney Company (DIS) with their market caps of ~$141.4 billion and ~$155.5 billion, respectively.

In the media space, the same metrics for Time Warner (TWX) and Dish Network (DISH) are ~$72.7 billion and ~$15.3 billion, respectively, as of the same date.

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Valuation metrics for Comcast

Valuation metrics consist of price-based multiples and earnings-based multiples. On May 17, Comcast had a trailing EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiple of 7.40x. In comparison, its closest peers Netflix, Dish, and Disney had EV-to-EBITDA multiples of 18.63x, 11.37x, and 10.09x, respectively.

Comcast expects its EV-to-EBITDA to be 7.27x in 2018, while in 2019, it expects this multiple to be 6.95x.

Comcast is now trading at a PE (price-to-earnings multiple) of 14.79x. In comparison, peers Netflix, Dish, and Disney have PEs of 196.36x, 19.34x, and 16.41x, respectively.

Returns

Comcast has fallen ~14.9% in the trailing-12-month period and ~2.6% in the trailing-one-month period. However, the stock has risen nearly 2.7% in the trailing-five-day period. 

In comparison, Netflix has generated a significant return of ~112.3% in the trailing-12-month period. Disney and Time Warner, however, have fallen 1.9% and 4.0%, respectively, in the same period.

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