Comcast stock trading at $35.63
Comcast (CMCSA) stock fell 6.0% on September 24 and closed trading at $35.63. Comcast lost ~$10.0 billion in market value. The stock is currently trading 17.0% above its 52-week low of $30.43 and 19.0% below its 52-week high of $44. The stock has lost 10.0% year-to-date, and its stock has fallen 3.7% in September.
Comcast successfully bid for Sky
Comcast stock was impacted after the company successfully outbid 21st Century Fox (FOXA) for the acquisition of the UK’s Sky. According to a September 24 Wall Street Journal report, Comcast offered $22.59 per share to acquire Sky. Twenty-First Century Fox’s bid was $20.48 per share.
The acquisition has been valued at $38.8 billion and is 40.0% higher than Comcast’s earlier bid in February. Sky is Europe’s pay-TV giant and has a base of 23.0 million customers. Sky generates a substantial portion of its revenues from satellite television, and some analysts believe that Comcast has overpaid to acquire the company.
Industry observers note that the satellite television model has become obsolete, driven by the rise in streaming services and the cord-cutting trend by consumers. MoffettNathanson analyst Craig Moffett stated that “whatever growth Comcast can generate in its new businesses will have to offset what we expect to be the inevitable declines in its core.”
Of the 31 analysts covering Comcast, 30 recommend a “buy,” and one recommends a “hold.” There were no “sell” recommendations. The average 12-month price target estimate is $43.32, indicating that the stock is trading at a discount of 22.0% to average estimates.