Comcast Stock: The Olympics Broadcast Is Expected To Bring In Record Revenues For CMCSA In 2016

zack Zack Tobin is a Financial Analyst at I Know First. 

Comcast Stock

  • Summer Olympics on pace to break the record for most advertising sales for a media event in U.S. history
  • Universal Studios Increasing Sales
  • Comcast Offering Higher Payment to Shareholders
  • I Know First Has a Bullish Forecast on Comcast

Comcast (Nasdaq: CMCSA) has been on a roll lately, with their earnings per share having gone up to $61.87, marking a 9.64% increase in the YTD, and 6.78% in the past year. This is a particularly impressive achievement because many media companies (such as Disney) have struggled, due to cord cutting. A lot of their success can be attributed to their subsidiary NBCUniversal. NBCUniversal is expected to help Comcast’s stock by broadcasting the upcoming Summer Olympics in Rio de Janeiro, as well as raising sales at their theme parks.

Comcast Stock

Olympics Expected To Bring In Record Revenue

In 2014, NBCUniversal bought the rights to broadcast the Olympic games through 2032 for $7.65 billion. On March 29th, the network has sold $1 billion worth in ads for the Olympics, with the games still four months away.  Buying the rights for such a hefty sum was a big gamble that looks to be paying off.

Having already sold $1 billion in ads by March is a huge accomplishment. In comparison, Comcast wasn’t able to reach $1 billion until July for the London 2012 games. Currently, the Rio games are on pace to break the record for most advertising sales for any media event in U.S. history.

Part of the huge success in advertisements can be attributed to the fact that Rio De Janeiro time zone only has a one-hour difference from U.S. Eastern Standard Time, which means more events can be broadcast live during prime time.

Universal Studios Increasing Sales

Another important segment for Comcast is their theme park business. NBCUniversal owns four Universal Studios parks, located in California, Orlando, Singapore, and Japan. After acquiring NBCUniversal in 2011, Comcast invested billions of dollars into renovating the once-aging theme parks. Universal Studio’s most notable addition has been the Wizarding World of Harry Potter. Since the Harry Potter world was added, the park has seen very strong Year-Over-Year growth, especially this past year, with a 27.3% to $3.3 billion increase in 2015.

Comcast Stock

With more people attending the theme park ticket prices for one-day passes have increased from $95 to $115. This may not please park-goers, but given all the new additions, it’s unlikely that it will be enough to prevent them from coming. As of now Universal Studios only makes up 5% of Comcast’s total revenue, but given how well the theme parks are doing, you can expect it to be more important to the company in the future.

Comcast Offering Higher Payment to Shareholders

Comcast offers a dividend yield of 1.83%, which is near the S&P 500 average. On April 27th, Comcast will make a cash payment of 27.5 cents a share to shareholders. This is an increase from previous quarters, where the cash payments were 25 cents per share. In order to get this payment, you would have to buy shares of Comcast by Wednesday, April 6th. This is all the more reason to buy shares in the company now, in order to benefit from the higher payout.

Stock Prediction

I Know First is a FinTech company that created an advanced state of the art algorithm based on artificial intelligence and machine learning to foresee market performance for more than 3,000 markets including stock forecasts, world indices, commodities, interest rates, ETFs, and currencies. In essence, the algorithm generates a with a signal and a predictability indicator. The signal is the number at the center of the box. The predictability is the figure at the bottom of the box. At the top, a particular asset is identified. This format is standardized across all forecasts the results of these predictions are shown on a daily basis on the I Know First website.

When comparing to Nasdaq analysts their predictions are very bullish towards Comcast as well. Out of 21 analysts, 17 place Comcast as a strong buy, 2 put it at a buy, and only 2 analysts put it as a hold.

Comcast Stock

(Source: Nasdaq)

Nasdaq.com is in line with I Know First’s bullish 3 months and the one-year forecast taken on March 29th, 2016.

Comcast Stock

We can observe that the three months forecast has a bullish signal of 34.91 and a predictability of 0.39. The one -year forecast has a bullish signal of 173.56 and a predictability of 0.44.

I Know First manages a great range of stocks and other financial instruments and predicts their movement in the market. Previously has predicted the movement for a range of Mega-Cap Blue Chip Stocks including CMCSA. A great example of this is the Mega-Cap forecast that we can see below had a fantastic year with 22.74% for the long position and 16.95% for the short position during the period from January 9th 2015 to 2016. Compared to the S&P500 return of -2.20% the I Know First forecast outperformed this negative return for the same year period. The top stock from the package was AMZN returning an amazing 110.94%.

Comcast Stock

Conclusion

With NBCUniversal about to broadcast the Olympics, and Universal Studios rapidly increasing their revenue, you can expect to see Comcast’s stock to continue its upward trajectory. The company has a proven track record and has no sign of slowing down. Now with a higher payout for shareholders, now is as good as a time as ever to buy Comcast.


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