WBD - Comcast rises as Atlantic upgrades on 'de-risked' broadband expectations

2023-04-18 08:23:58 ET

Comcast ( NASDAQ: CMCSA ) shares rose more than 1% in premarket trading on Tuesday as investment firm Atlantic Equities upgraded the media and telecommunications giant, citing recent underperformance in its stock.

Analyst Hamilton Faber raised his rating on Comcast ( CMCSA ) shares to overweight from neutral, while raising the per-share price target to $44 from $36, noting that the stock has underperformed the S&P 500 by 30% over the past two years on weakening broadband fundamentals, resulting in growth investors leaving the stock.

However, it looks as if broadband expectations have been "de-risked" and there may be potential upside later this year, assuming a rebound in the housing market.

"Furthermore, in the event of a recession later this year, Comcast is well positioned as a defensive name," Faber wrote in an investor note.

In addition, Faber said any potential acquisition of Warner Bros. Discovery ( WBD ) by Comcast ( CMCSA ) - something that has been rumored about - and a subsequent spin-off of the resulting content business could be worth an additional $8 per share.

Nintendo ( OTCPK:NTDOY ) and Illumination's ( CMCSA ) The Super Mario Bros. Movie continued to be a strong-hold at the box office in its second weekend, grossing $92M in receipts and becoming the top movie of 2023 .

Analysts are largely bullish on Comcast ( CMCSA ). It has a BUY rating from Seeking Alpha authors , while Wall Street analysts rate it a BUY . Conversely, Seeking Alpha's quant system, which consistently beats the market, rates CMCSA a HOLD .

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