MW Comcast's broadband woes may fuel the stock's worst day in 16 years. What's next?

By Ciara Linnane and Emily Bary

Some analysts see brighter days ahead for the company, with its new Epic Universe theme park on the horizon

Comcast Corp.'s stock could see its worst day in 16 years, with its broadband pressures continuing, but at a steeper pace than expected.

The company lost 139,000 subscribers in its residential broadband business during the fourth quarter, when factoring in some negative impact associated with hurricanes Milton and Helene. Analysts tracked by FactSet were expecting the company to shed 105,000 subscribers.

"Comcast beat on most metrics ... but missed on the one that is virtually all anyone cares about, broadband net adds," MoffettNathanson analyst Craig Moffett wrote in a note to clients, while maintaining his buy rating. The report capped off a "miserable" year for Comcast, he wrote, with shares badly lagging the S&P 500 SPX in the wake of sustained broadband pressures.

See also: Comcast seen taking 'one step forward, two steps back' in tough broadband market

What comes next? Things may be poised to get "less bad," in Moffett's view. "Broadband subscriber losses have now likely peaked," he wrote, and there are encouraging signs elsewhere in the business. For instance, Comcast plans to open its new Epic Universe theme park in May in Orlando, Fla., and the company has been looking to unlock value through a previously announced spinoff of some of its cable networks.

Read: Will Comcast's spinoff of some cable networks give the stock the desired bump?

"And it doesn't hurt that the stock looks cheap," he added, with it trading at a bit more than 5 times his estimate for 2028 free cash flow per share.

Edward Jones analyst David Heger also saw brighter days ahead. "We think theme park revenue and profits will return to growth in 2025 with opening of the Epic Universe park," he wrote. "We also expect narrowing Peacock losses and the transition to profitability to contribute to earnings growth." Heger also rates the stock a buy.

For now, though, Comcast investors seem focused on the negatives, with shares down 12.5% and tracking toward their worst one-day percentage drop since a 13% loss seen Sept. 29, 2008, according to Dow Jones Market Data.

Shares of peer Charter Communications Inc. $(CHTR)$ are down 7.4%.

In terms of the financials, Comcast had fourth-quarter net income of $4.78 billion, or $1.24 a share, up from $3.26 billion, or 81 cents a share, a year ago. Adjusted for one-time items, earnings per share came to 96 cents, ahead of the 86-cent FactSet consensus.

Revenue rose 2.1% to $31.9 billion, ahead of the $31.6 billion FactSet consensus.

Chief Executive Brian L. Roberts cited a strong performance at the company's studios and streaming service Peacock as positives, along with a 5% growth in connectivity revenue and 1.2 million mobile-line additions.

The company also raised its quarterly dividend by 6.5% to 8 cents a share.

Connectivity revenue rose 4.9% to $11.5 billion in the quarter, driven by growth in domestic broadband, domestic wireless, international connectivity and business services.

The stock has fallen 30% in the last 12 months, while the S&P 500 has gained 23%.

-Ciara Linnane -Emily Bary

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

January 30, 2025 11:56 ET (16:56 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.