CMCSA Stock Report

2-Year Price History

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Ockham's Rating

CMCSA Stock Evaluation

Our analysis of CMCSA over the last week has not necessitated a downgrade at this time. There has been almost no net change in share price and also earnings estimates have not been amended or restated in that time. We will continue to track closely the current ratios and metrics for CMCSA and evaluate them against historical averages and comparable peer analysis. This framework will give us the tools necessary to understand when a downgrade from our Greatly Undervalued rating will be most timely.

CMCSA Revenue

As we have often noted, in our valuation methodology, "Cash is King." Well, it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, CMCSA the high and low end of the Price to Sales per share ratios are 3.51x and 2.10x respectively.

Notice that CMCSA's current Price to Sales per share ratio is 1.13x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $13.89, CMCSA is 60% below where we would expect to see it. This will beneficially factor into our final analysis of CMCSA as it is not often that this stock sinks to these levels.

CMCSA Cash Earnings

As the old saying goes, "Cash is King!" However, we prefer to capture a few other items within our analysis to identify "cash earnings". Nevertheless, an analysis of Cash Earnings is absolutely pivotal to assessing a company's value, and currently CMCSA is significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for CMCSA, the current level of Cash Earnings compared to its historical levels helps identify where CMCSA is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 13.43 and a historical low Cash Earnings per share ratio of 7.77, an investor can relate where value becomes optimal.

So with CMCSA's current price (latest close of $13.89) and most recent level of Cash Earnings reported, we see significant opportunity from a value perspective. At its current price level, CMCSA is 58% below its average level of Price to Cash Earnings on a historical basis. This means that investors were willing to pay for a much higher stock price than currently for the same level of Cash in the past, on a relative basis. There are a couple of important things to remember, however. First, value doesn't exist in a vacuum. So if the market doesn't recognize this value, even a great disparity in Price to Cash Earnings cannot force an immediate stock price reaction. Second, patience is key when looking at securities that have reached these levels of Price to Cash Earnings versus their historical norms. So be patient with CMCSA.

CMCSA Dividends

A positive Ockham rating does not require a company to pay out an inviting dividend or a dividend at all. However, we believe dividends provide a useful measure of a company's inherent expectations.

Comparable to our analysis of Sales and Cash Earnings per share, we examine dividend yields from CMCSA against the historic high and low levels over an available data range. Because CMCSA has an established history of paying a dividend to shareholders, there is value in comparing recent dividends to historical dividends. In CMCSA’s case, the estimated annual dividend is $0.27 producing a current dividend yield of 1.94%. The highest dividend yield from CMCSA in recent history was 2.93% while the lowest dividend yield was 0.00%. It's hard not to notice that CMCSA pays a current dividend yield that is 32.42% above the historical median. This peaks our interest since our analysis is looks favorably upon dividend yields that are greater than the historical median.