Comcast: CFO Talked Q3 Slowdown at BofA Conference, Shares Down 5%+

(Substack Exclusive) Company Update (CMCSA US) (Buy)

Introduction: Comcast CFO Mike Cavanagh appeared at an investor conference (with BofA Securities) this morning. Among other things, he stated that Comcast has seen a slowdown in Cable net adds in late August and now expects Q3 net adds to be lower than in 2019 (but with Q2-3 combined and FY21 net adds both still higher). Comcast shares are currently down 5.3%, while peers Charter and Altice USA are down 4.1% and 1.2% respectively.

Capital Allocation: Buybacks and Leverage Target

• The bar for CMCSA to pursue any acquisitions of material size is “really high”, because of the quality of the assets already in the group

• More open to smaller bolt-on acquisitions, and have made some recently

• 50/50 streaming venture with Viacom in 20 European markets outside Sky footprint is another example where capital can be deployed

• Consistently methodology in capital allocation - wants to have strong balance sheet, Net Debt / EBITDA will get to 2.5x next year (2022) which is roughly where management wants it t…