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3 Reasons Why Comcast Corporation (CMCSA) Could Beat Earnings Estimates

Comcast Corporation CMCSA is among the world’s leading communication companies, providing basic cable, digital cable, and high speed internet services that connect people to what’s important in their lives. More importantly, the company is prepared to release its quarterly earnings report before the market opens on July 27.

Comcast currently sports a Zacks Rank #3 (Hold) has defeated its earnings projections in twelve of its past thirteen operational quarters, including an impressive beat last quarter of 20.45%. Furthermore, Comcast operates in the Cable Television industry, which ranks in the top 48% of the Zacks Industry Rank.

Due to Comcast’s adequate Zacks Rank, impressive earnings results history, and Earnings ESP of 2.08%, investors should possess optimism heading toward the company’s report date.

If that isn’t enough, here are 3 additional reasons to be confident about Comcast as we approach July 27:

1.       Impressive Style Scores

Comcast currently holds impressive Style Score ratings, including “A” grades for Growth and Momentum, as well as a “B” grade for Value. Comcast’s “B” grade in Value is driven by a 5.04% earnings yield, as well as a PEG ratio of 2.20, both of which defeat the industry averages of 3.52% and 3.17, respectively.

Comcast’s “A” grade in Growth is driven by a net margin of 11.12% and projected sales growth of 5.15%, both of which beat industry averages. Additionally, Comcast’s strong Momentum grade is partially due to its share price increase of 18.34% over the past year, which crushes the modest 7.79% gain of its industry peers.

2.       Expansion to New Customers

In late March 2017, Comcast announced that it gained the rights to offer online TV services nationwide from several unnamed cable networks due to the ‘most favored nation’ clause in its contract. This allows Comcast to sell its video services outside its regional territories, to new cities like New York and Los Angeles, for the first time. This marks Comcast’s foray into online streaming TV services, thus diversifying its range of offerings. Also, Comcast is working on renegotiating long-term deals with some its major partners, including CBS and ESPN.

3.       Growth in Key Divisions

Comcast is projected to report revenue growth in several of its key divisions. According to our consensus estimates, Comcast’s NBCUniversal division is expected to post 12.3% year-over-year revenue increase, bringing its quarterly total to around $7.9 billion. Furthermore, our consensus estimates call for Comcast to post 40% growth in its Filmed Entertainment division and 13% growth Theme Parks division, bringing these totals to around $1.9 billion and $1.3 billion, respectively.

These consensus estimates are from our exclusive non-financial metrics estimate file. These estimates are updated daily and are based on the independent research of expert stock analysts. Learn more here>>>

Currently, the Zacks Consensus Estimates call for revenues of $20.82 billion and earnings of $0.48 per share, which would represent year-over-year growth of 8.03% and 16.27%, respectively.

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