Earlier today, Benchmark initiated coverage on Comcast (CMCSA) stock with a “buy” rating and a target price of $64. This implies a return potential of about 40% from its stock price of $45.71 on September 24.
As reported by The Fly, Benchmark’s Matthew Harrigan thinks that “the company is uniquely positioned to benefit from fixed and wireless/mobile broadband growth, direct-to-consumer alternatives to traditional TV bundles and advanced advertising.”
The report added, “He sees the potential at Comcast for low teens annual adjusted EPS growth, assuming resumed buyback activity in 2020.”
Comcast stock fell about 1.09% on September 24, and the stock closed the trading day at $45.71. At the closing price of $45.71, Comcast’s market capitalization is $207.75 billion.
Comcast stock is trading 3.3% lower than the 52-week high of $47.27 on September 12. Meanwhile, the stock is trading 40.17% higher than the 52-week low of $32.61 on December 26, 2018. Overall, Comcast stock has returned around 34.2% year-to-date.
Comcast: Analysts’ recommendations and target price
In September, the consensus rating for Comcast stock was a “buy.” Analysts have turned more bullish on the stock over the past three months. Among the 34 analysts covering Comcast stock, 29 analysts have “buy” ratings on the stock—up from 27 in the previous month. Five analysts have “hold” ratings on the stock—down from six in the previous month. In addition, none of the analysts recommended a “sell.”
Currently, Comcast analysts have a 12-month target price of $49.52 on the stock. On September 24, the stock was trading at a discount of 8.3% to analysts’ 12-month target price. Also, its median target price was $50.00 on the same date.
Forward PE ratio
Comcast stock has a forward PE ratio of 14.89x for fiscal 2019. For fiscal 2020, the ratio is 13.4x. The company’s adjusted EPS would rise 20.4% in fiscal 2019, it would rise 11.1% in fiscal 2020.
CMCSA stock looks cheap, considering its expected earnings growth for fiscal 2019. However, the stock looks expensive based on its expected earnings growth for fiscal 2020.
Growing revenue and earnings
Comcast’s revenues are expected to rise 16.0% in fiscal 2019 to $109.61 billion. Its sales could increase by 5.3% in fiscal 2020 to $115.46 billion. By fiscal 2021, they could increase 2.1% to $117.88 billion.
In comparison, the company’s adjusted EPS could rise 20.4% to $3.07 in fiscal 2019. The company’s adjusted EPS could increase by 11.1% to $3.41 in fiscal 2020. Also, it could increase at an annual rate of 10.21% in the next five years. Comcast has a dividend yield of 1.84%.
Comcast’s stock returns
The stock’s trailing five-day, trailing one-month, and trailing 12-month price movements were -2.1%, 7.7%, and 28.3%, respectively. Based on its September 24 closing price, Comcast stock was trading 0.4% below its 20-day moving average of $45.90. The stock was trading 2.9% above its 50-day moving average of $44.41.
The company was trading 5.0% above its 100-day moving average of $43.55. Comcast’s 14-day relative strength index (or RSI) score is 53, which indicates that investors are neutral toward the stock.
On September 24, Comcast stock closed near its Bollinger Band midrange level of $45.80. This value indicates that the stock isn’t overbought or oversold. Read Oppenheimer Upgrades Undervalued Comcast Stock to learn more.