Seaport Global downgrades Comcast stock rating to Neutral from Buy

Investing.com - Seaport Global Securities downgraded Comcast Corp (NASDAQ:CMCSA) stock rating to Neutral from Buy on Friday, citing concerns about the company’s broadband business. The stock, currently trading at $27.32, has fallen significantly from its 52-week high of $45.31 and appears substantially undervalued according to InvestingPro Fair Value estimates. Adding to investor concerns, InvestingPro data shows 10 analysts have recently revised their earnings expectations downward for the upcoming period.

The downgrade comes despite Comcast’s attractive 4.8% dividend yield, which Seaport Global had previously highlighted as appealing for long-term value investors. This dividend appears well-supported, as InvestingPro data reveals Comcast has maintained dividend payments for 18 consecutive years and has raised its dividend for 6 consecutive years, with 6.45% dividend growth in the last twelve months. The research firm now expresses concern about "incrementally negative Broadband ARPU and cost commentary" needed to drive broadband and wireless volumes.

Seaport Global does not anticipate a potential inflection in Broadband ARPU and OIBDA declines until possibly the third quarter of 2026, suggesting investors need not "rush to buy the pullback" in Comcast shares.

The research firm acknowledges several positive developments across Comcast’s portfolio, including Business Services, Theme Parks, and Studio operations. Seaport also notes that the Media segment has significant programming investments affecting EBITDA while boosting ad revenue in coming quarters, including a new NBA rights deal and Winter Olympics.

Despite these bright spots, Seaport Global emphasizes that "the Broadband business cash flow drives the economics of CMCSA," making the challenges in that segment the decisive factor in its downgrade decision.

In other recent news, Comcast reported its third-quarter 2025 earnings, surpassing analyst expectations with an earnings per share (EPS) of $1.12, compared to the forecasted $1.10. Revenue also exceeded predictions, reaching $31.2 billion against the anticipated $30.7 billion. Despite these positive results, Comcast faced some challenges, as noted by several analyst firms. Goldman Sachs downgraded Comcast from Buy to Neutral, citing concerns over broadband pricing and increased operational expenses during a transition period. KeyBanc also downgraded the company to Sector Weight, pointing to increased investment needs and reduced shareholder returns. Meanwhile, TD Cowen adjusted its price target for Comcast to $40.00 from $46.00 but maintained a Buy rating, acknowledging the company’s better-than-feared broadband losses and in-line EBITDA. These developments highlight the mixed reactions from analysts following Comcast’s recent financial performance.

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