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Comcast Stock: Analysts’ Target Price and Ratings

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Comcast (CMCSA) stock was down 0.70% at $43.74 at the time of this writing. The Dow Jones Industrial Average was also down more than 0.9%. Plus, the S&P 500 and Nasdaq Composite were down about 0.71% and 0.74%, respectively. This sell-off was due to a fear of recession in the US economy.

Investors were worried about the Institute for Supply Management’s Non-Manufacturing PMI (purchasing managers’ index) data released today. The services PMI reached 52.6, which was lower than the expectation of 55.3 and also lower than the previous month’s reading of 56.4.

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Comcast stock: Analysts’ recommendations and target price

Generally, Wall Street analysts are bullish on Comcast stock. On October 2, 35 Wall Street analysts covered Comcast stock. Among these analysts, nine recommended a “strong buy,” 21 recommended a “buy,” and five recommended a “hold.” The stock hasn’t received any “strong sell” or “sell” ratings from these analysts.

Based on analysts’ estimates, the stock has a mean price target of $50.30, above its last closing price of $44.05. This difference implies an estimated upside of 14.2% for the next 12 months.

On Wednesday, MoffettNathanson raised its 12-month target price for Comcast stock from $43 to $49. The new target implies an 11.2% upside from the stock’s last closing price of $44.05. MoffettNathanson analyst Craig Moffett reiterated his “neutral” rating on the stock in a note to clients, according to The Fly.

The Fly reported that in Moffett’s view, “The idea that cable margins could climb as high as 50% shouldn’t be viewed skeptically.” The report added, “He believes that as video fades as a percentage of revenue, the cable business ‘gets closer and closer to being a pure telecommunications business.'”

In September, Pivotal Research raised its target price on Comcast stock from $54 to $56. Credit Suisse raised its target price on the stock from $52 to $55. Also, Benchmark initiated coverage on Comcast stock with a “buy” rating and a target price of $64.

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Jim Cramer’s pick

Jim Cramer, CNBC’s Mad Money host, isn’t as optimistic about Netflix’s (NFLX) prospects. During the program’s lightning round on Tuesday, Cramer said, “I’m not a Netflix fan, here. I got this Disney, I got the Comcast, got the CBS, got the Disney, I got the ESPN+. No. There’s too many competitors.”

Stock returns

Comcast stock fell about 1.06% on Wednesday. The stock closed the trading day at $44.05. At this price, it was valued at $200.21 billion. It was trading 6.81% below its 52-week high and 35.08% above its 52-week low.

Comcast stock has fallen 3.9% in the last five trading days. However, CMCSA stock has risen 29.4% year-to-date.

Comcast has forward PE ratios of 14.37x for 2019 and 12.9x for 2020. Compare that with an expected 20.4% EPS increase in 2019, and the stock might appear cheap.

Comcast is expected to announce its third-quarter financial results on October 24. In the third quarter, analysts expect Comcast’s revenue to rise 22.4% YoY (year-over-year) to $27.1 billion. Plus, its adjusted EPS is expected to rise 15.4% YoY to $0.75.

Comcast expects strong broadband customer net additions in the third quarter. During the Goldman Sachs 28th Annual Communacopia Conference on September 18, Comcast’s Chairman and CEO, Brian Roberts, said, “In broadband, let me start and say that we’re having a great third quarter. And we’ve continued for now, this will be the 14th straight year where we will easily surpass a million net ads, in broadband.”

In the second quarter, Comcast added 209,000 net broadband customers. In fiscal 2018, the company added 1.4 million net broadband customers. The company’s broadband revenue jumped more than 9% YoY to $4.66 billion in the second quarter.

Read Roku Stock Fell Due to Comcast’s Product Announcement and Oppenheimer Upgrades Undervalued Comcast Stock to learn more.

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