Copyright Forbes
Comcast stock (NASDAQ: CMCSA), one of the largest cable television and internet service providers in the U.S., has experienced a decline in its stock, now approximately $28 per share, down over 50% from its peak of $61.75 in September 2022. This selloff has resulted in Comcast’s valuation being pegged at a modest 6.5x forward earnings, with a dividend yield nearing 5% – indicators that imply investors are anticipating a prolonged downturn. Investing in individual stocks can be hazardous, however, a more extensive, diversified strategy offers considerable value. For those looking for upside with diminished volatility compared to holding a single stock, consider the High Quality Portfolio (HQ) – HQ has outperformed its benchmark, a combination of the S&P 500, Russell, and S&P midcap index, achieving returns that exceed 105% since its inception. Risk management is crucial - ponder what the long-term performance of a portfolio could be if you integrated 10% commodities, 10% gold, and 2% crypto with HQ’s performance metrics. The current weakness reflects a combination of structural and cyclical hurdles. The broadband market has sharply decelerated following the surge driven by the pandemic, while the trend of cord-cutting continues to diminish the company's cable TV subscriber count. Furthermore, Comcast’s broadband division is under pressure from wireless companies that are utilizing their high-capacity 5G networks to provide fixed wireless broadband services, thereby intensifying competition. Compounding investor worries, Comcast has a significant debt burden of almost $100 billion. From an operational standpoint, the company lost 104,000 broadband customers in the latest quarter – marking its fourth consecutive quarter of losses. Adjusted EPS was reported at $1.12, slightly exceeding expectations but remaining flat year-over-year, while total revenue declined by 2.7% to $31.2 billion, partially attributed to a challenging comparison with last year’s boost from the Paris Olympics. With sentiment overwhelmingly negative and valuations compressed, the pressing question is: what catalysts might spur a re-rating of Comcast’s stock? Wireless Convergence Comcast’s wireless operations remain robust, attracting a notable 414,000 net domestic subscribers in Q3 2025. Xfinity Mobile now boasts 8.9 million lines (an increase of 1.2 million YoY). This “converged” approach reduces churn for bundled households, enhances average revenue per account, and initiates a positive cycle: improved retention leads to lower acquisition costs. This strategy could assist Comcast in protecting its 31.4 million broadband base from fixed wireless access (FWA) attrition. MORE FOR YOU Broadband Subscriber Losses Moderating Domestic broadband net losses have shown consistent improvement: -199,000 in Q1 2025, -226,000 in Q2, and just -104,000 in Q3—less than half of the previous quarter's losses. This slowdown indicates a reduction in FWA pressure, as well as Comcast's mid-split enhancements that allow for multi-gig speeds, alongside targeted retention efforts. A shift towards flat net additions in 2026 would signify peak competitive pressure, while a resurgence in ARPU growth (Q3 increased by 2% YoY excluding one-offs) could alleviate saturation concerns. Stabilizing at 31.4 million subscribers together with a 2% to 3% annual ARPU increase could continue to facilitate high-margin revenue growth as costs remain largely fixed. Theme Parks Growth The Parks division reported 18% YoY revenue growth to $2.72 billion in Q3 2025, driven by record domestic attendance, increased per-cap spending, and the May 2025 launch of Epic Universe in Orlando – Universal's largest-ever investment in a park. Early indicators (soft-open data, hotel bookings) suggest an uptick in attendance for the Orlando resort in 2026 as ride capacity increases and Epic Universe fully scales throughout the year. Pricing Simplification and CX Overhaul to Rebuild Loyalty Comcast is revamping its rate plans by removing hidden fees and investing in AI-driven support tools to reduce call-center interactions and the number of unsatisfied customers. Initial pilot programs have shown a decrease in churn in test markets. Enhanced retention directly strengthens unit economics. As service perceptions improve, Comcast may gain more leeway with pricing, which could support a re-rating. Portfolio Rationalization, Regulatory Tailwinds Comcast intends to spin off the majority of its traditional cable television networks — including USA, MSNBC, and CNBC — into a new entity termed Versant Media Group. This strategy segregates the slower-growing segment of the business from Comcast’s more rapidly expanding areas like Peacock streaming, movie studios, and theme parks. In doing so, Comcast can concentrate more on its operations with greater long-term growth potential. Concurrently, new tax regulations under the One Big Beautiful Bill Act enable Comcast to recoup broadband infrastructure expenditures more swiftly. This reduces the company's tax burden and enhances cash flow — yielding approximately $1 billion annually that can be allocated for future investment.
