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Buy Comcast Now Before Everyone Else Does (CMCSA)


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Sezeryadigar/E+ via Getty Images

I know that value investors feel a bit of frustration right now.

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Charlie Bilello

What with this correction so far seeing a peak 12.4% decline and now the market appears to be ripping higher again.

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YCharts

The market is now just 7% from its highs and tech stocks are, at least for the moment, screaming higher.

Does this mean the “buy the dip” crowd has won? It depends on your time frame.

  • in the long-term buy the dip is always a good idea
  • because stocks always go up if your time frame is long enough

In 2022 it’s possible that we’ll still see a 15% or even 20% correction, though it might not happen in the first half of the year.

But guess what? Amazing dividend growth blue-chips like Comcast (CMCSA) are still in a bear market and NOT screaming higher… yet.

Remember that it’s always and forever a market of stocks, not a stock market.

So let me tell you why Comcast is one of my top priority correction watchlist companies and the three reasons why you might want to buy this hyper-growth Super SWAN now before everyone else does later.

Reason 1: World-Class Quality You Can Trust

The Dividend King’s overall quality scores are based on a 233 point model that includes:

  • dividend safety

  • balance sheet strength

  • credit ratings

  • credit default swap medium-term bankruptcy risk data

  • short and long-term bankruptcy risk

  • accounting and corporate fraud risk

  • profitability and business model

  • growth consensus estimates

  • cost of capital

  • long-term risk-management scores from MSCI, Morningstar, FactSet, S&P, Reuters’/Refinitiv and Just Capital

  • management quality

  • dividend friendly corporate culture/income dependability

  • long-term total returns (a Ben Graham sign of quality)

  • analyst consensus long-term return potential

It actually includes over 1,000 metrics if you count everything factored in by 12 rating agencies we use to assess fundamental risk.

How do we know that our safety and quality model works well?

During the two worst recessions in 75 years, our safety model predicted 87% of blue-chip dividend cuts during the ultimate baptism by fire for any dividend safety model.

How does CMCSA score on one of the world’s most comprehensive and accurate safety models? Very well indeed.

Dividend Safety

Rating Dividend Kings Safety Score (145 Point Safety Model) Approximate Dividend Cut Risk (Average Recession)

Approximate Dividend Cut Risk In Pandemic Level Recession

1 – unsafe 0% to 20% over 4% 16+%
2- below average 21% to 40% over 2% 8% to 16%
3 – average 41% to 60% 2% 4% to 8%
4 – safe 61% to 80% 1% 2% to 4%
5- very safe 81% to 100% 0.5% 1% to 2%
CMCSA 93% 0.5% 1.4%

Long-Term Dependability

Company DK Long-Term Dependability Score Interpretation Points
Non-Dependable Companies 18% or below Poor Dependability 1
Low Dependability Companies 19% to 57% Below-Average Dependability 2
S&P 500/Industry Average 58% (58% to 67% range) Average Dependability 3
Above-Average 68% to 77% Very Dependable 4
Very Good 78% or higher Exceptional Dependability 5
CMCSA 76% Very Dependable 4

Overall Quality

CMCSA Final Score Rating
Safety 93% 5/5 very safe
Business Model 80% 3/3 wide moat
Dependability 76% 4/5 very dependable
Total 86% 12/13 Super SWAN

CMCSA is a medium-risk Super SWAN with long-term risk-management in the 55th industry percentile.

CMCSA: 92nd Highest Quality Master List Company (Out of 509) = 82nd Percentile

The DK 500 Master List includes the world’s highest quality companies including:

  • All dividend champions

  • All dividend aristocrats

  • All dividend kings

  • All global aristocrats (such as BTI, ENB, and NVS)

  • All 13/13 Ultra Swans (as close to perfect quality as exists on Wall Street)

  • 43 of the world’s best growth stocks (on its way to 50)

CMCSA’s 86% quality score means its similar in quality to such blue-chips as

  • Philip Morris International (PM) – dividend king
  • Visa (V)
  • Linde (LIN) – dividend aristocrat
  • Abbott Labs (ABT) – dividend king
  • Lockheed Martin (LMT)
  • Altria (MO) – dividend king
  • Realty Income (O) -dividend aristocrat
  • Mastercard (MA)
  • Walmart (WMT) – dividend aristocrat
  • NVIDIA (NVDA)

Basically, even among the world’s highest quality companies, CMCSA is higher quality than 82% of them.

What makes Comcast so high quality?

Comcast is made up of three parts. The core cable business owns networks capable of providing television, Internet access, and phone services to roughly 60 million U.S. homes and businesses, or nearly half of the country. About 55% of the homes in this territory subscribe to at least one Comcast service.

Comcast acquired NBCUniversal from General Electric in 2011. NBCU owns several cable networks, including CNBC, MSNBC, and USA, the NBC broadcast network, several local NBC affiliates, Universal Studios, and several theme parks. Sky, acquired in 2018, is the dominant television provider in the U.K. and has invested heavily in exclusive and proprietary content to build this position. The firm is also the largest pay-television provider in Italy and has a presence in Germany and Austria.” – Morningstar

This is a highly diversified media conglomerate.

  • a telecom giant (56% of sales)
  • a media giant (27% of sales)
  • and a theme parks giant (16% of sales)

One that has an exceptional track record of delivering market-smashing dividend growth and total returns.

  • $1 invested into CMCSA in 1972 at the IPO price is now worth $381 adjusted for inflation
  • 12.9% CAGR real returns vs 6.5% CAGR S&P 500
  • 2X the annular returns = almost 18X the wealth over 49 years

Business Update

Comcast Ramps Up Peacock Investment as Broadband Growth Slows; Shares Attractive…

The firm again posted a drop in broadband customer additions during the period (212,000 versus 538,000 a year ago), which management continues to ascribe to a slowdown in housing activity…

Management announced that it will increase investment to extend the firm’s network to more new locations in 2022 and beyond, which we believe is a smart, if overdue, use of capital…

NBCU plans to double Peacock content investment to $3 billion in 2022, ramping to $5 billion annually over the next couple years…

Given the content and resources at NBCU’s disposal, we believe it can catch up, but stiff competition for customers and content will likely hurt profitability over the next couple years more than we had expected…

Total NBCU revenue increased 26% year over year during the quarter, with the theme park business delivering impressive results, but increasing content costs pulled the segment’s EBITDA margin down to 13.7% from 18.5% last year.” – Morningstar

Peacock is far behind in the streaming wars, with 24.5 million subscribers, compared to well over 200 million for Netflix (NFLX), and Amazon (AMZN), and Disney’s almost 120 million.

Even AT&T’s (T)’s HBO Max has about 2.5X as many subscribers.

However, streaming is the future and CMCSA has the financial resources to at least put up a good fight in this important part of its business.

CMCSA Credit Ratings

Rating Agency Credit Rating 30-Year Default/Bankruptcy Risk Chance of Losing 100% Of Your Investment 1 In
S&P A- stable 2.50% 40.0
Fitch A- stable 2.50% 40.0
Moody’s A3 (A- equivalent) stable 2.50% 40.0
Consensus A- stable 2.50% 40.0

(Sources: S&P, Moody’s, Fitch)

This is an A-rated company with very low fundamental risk.

CMCSA Leverage Consensus Forecast

Year Debt/EBITDA Net Debt/EBITDA (3.5 Or Less Safe According To Credit Rating Agencies)

Interest Coverage (4+ Safe)

2020 3.37 2.99 3.81
2021 2.84 2.52 5.02
2022 2.49 2.24 5.92
2023 2.44 2.14 6.76
2024 2.10 1.97 7.27
2025 1.86 1.85 7.61
Annualized Change -11.14% -9.14% 14.82%

(Source: FactSet Research Terminal)

The balance sheet is getting steadily stronger, with debt declining steadily and cash flow growing at 7% with cash flows at 7% to 12%.

CMCSA Balance Sheet Consensus Forecast

Year Total Debt (Millions) Cash Net Debt (Millions) Interest Cost (Millions) EBITDA (Millions) Operating Income (Millions) Interest Rate
2020 $103,760 $11,740 $92,020 $4,588 $30,826 $17,493 4.42%
2021 $98,270 $9,718 $87,158 $4,193 $34,605 $21,055 4.27%
2022 $95,413 $8,149 $85,913 $4,134 $38,315 $24,473 4.33%
2023 $99,988 $13,768 $87,631 $4,029 $40,957 $27,221 4.03%
2024 $90,308 $14,458 $84,774 $4,071 $43,061 $29,596 4.51%
2025 $83,255 $16,120 $82,536 $4,032 $44,642 $30,675 4.84%
2026 NA NA NA NA $46,500 $772 NA
Annualized Growth -4.31% 6.55% -2.15% -2.55% 7.09% 11.89% 1.84%

(Source: FactSet Research Terminal)

Management is committed to its A-credit rating and plans to maintain leverage below 3.5 debt/EBITDA, which rating agencies consider safe for this industry.

We ended the year with net leverage at 2.4 times and returned a total of $8.5 billion to shareholders, including $4.5 billion in dividend payments and $4 billion in share repurchases.

For 2022 as I said previously, we expect to continue to maintain leverage at around current levels, which I expect will support continued strong capital returns.” – CFO, Q4 conference call

CMCSA Bond Profile

  • $25.4 billion in liquidity
  • very well staggered bond maturities
  • no trouble refinancing these bonds
  • the bond market is willing to lend to CMCSA for 75 years at 4.4%
  • the smart money on Wall Street is very confident in CMCSA’s business prospects

CMCSA Credit Default SWAPs

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FactSet Research Terminal

Credit default swaps are insurance against bond defaults, and thus represent a real-time bond market estimate of a company’s short and medium-term bankruptcy risk.

  • 10-year bankruptcy risk 0.9%
  • 5-year bankruptcy risk 0.565%

Note how the price has crashed in recent months. Yet the bond market’s real-time estimate of fundamental risk has been relatively steady, rising only a modest amount since management announced higher content spending for Peacock during earnings.

As long as fundamental risk is not rising, a crashing stock price is not a concern for prudent long-term income investors.

  • analysts, rating agencies, and the bond market all agree the thesis remains intact

If the companies fundamental risk were to become elevated enough for investors to worry we’d know about it and rating agencies would also begin to downgrade CMCSA during their annual credit rating reviews.

Profitability: Wall Street’s Favorite Quality Proxy

CMCSA’s historical profitability is in the top 20% of its peers.

CMCSA Trailing 12-Month Profitability Vs. Peers

Metric Industry Percentile Major Global Media Companies More Profitable Than CMCSA (Out Of 965)
Operating Margin 84.05 154
Net Margin 80.73 186
Return On Equity 80.20 191
Return On Assets 69.63 293
Return On Capital 71.50 275
Average 77.22 220

(Source: GuruFocus Premium)

Our definition of a wide moat is maintaining profitability in the top 25% of peers for decades.

CMCSA has maintained 80th percentile profitability for 30+ years despite numerous potential disruption risks.

CMCSA Profit Margin Consensus Forecast

Year DCF Margin EBITDA Margin EBIT (Operating) Margin Net Margin Return On Capital Expansion

Return On Capital Forecast

2020 12.8% 29.8% 16.9% 10.2% 1.27
2021 12.8% 29.9% 18.2% 12.3% TTM ROC 45.76%
2022 12.9% 31.3% 20.0% 13.0% Latest ROC 47.10%
2023 14.3% 32.6% 21.7% 14.4% 2026 ROC 58.04%
2024 16.0% 33.0% 22.7% 14.9% 2026 ROC 59.74%
2025 16.9% 33.6% 23.1% 15.4% Average 58.89%
2026 16.6% 33.7% 0.0% 15.2% Industry Median 13.53%
Annualized Growth 4.38% 2.10% 6.45% 6.98% CMCSA/Peers 4.35
Vs S&P 4.53

(Source: FactSet Research Terminal)

Comcast’s margins are expected to steadily improve over time, despite higher growth spending for things like Broadband expansion and Peacock.

ROC has been steady for a decade (not counting the pandemic that shut parks).

ROC is up 100% in the last three decades.

Return on capital is pre-tax profit/the money it takes to run the business (operating capital).

This is Joel Greenblatt’s gold standard proxy for quality and moatiness, and Comcast has some of the best ROC in the industry.

CMCSA Dividend Growth Consensus Forecast

Year Dividend Consensus FCF/share Consensus Payout Ratio Retained (Post-Dividend) Cash Flows Buyback Potential Debt Repayment Potential
2021 $1.00 $3.16 31.6% $9,869 4.46% 10.0%
2022 $1.08 $3.56 30.3% $11,331 5.12% 11.5%
2023 $1.20 $4.41 27.2% $14,666 6.63% 15.4%
2024 $1.28 $4.81 26.6% $16,129 7.29% 16.1%
2025 $1.35 $5.43 24.9% $18,642 8.42% 20.6%
2026 $1.40 $6.08 23.0% $21,383 9.66% 25.7%
Total 2021 Through 2026 $3.28 $11.13 29.5% $35,866.65 16.20% 36.50%
Annualized Rate 6.96% 13.98% -6.16% 16.72% 16.72% 20.66%

(Source: FactSet Research Terminal)

  • 70% FCF payout ratios are safe according to rating agencies for this industry
  • CMCSA’s is expected to fall to 23% by 2026
  • $36 billion post-dividend retained cash flow
  • enough to pay off 37% of debt or buy back 16% of shares.
  • Up to almost 10% of shares in 2026 at today’s valuation
  • $60.6 billion in buybacks expected through 2026
  • 27% of shares at current valuations
  • 6% per year

Comcast has already bought back $4 billion in stock in 2021 and the board just increased the authorization by another $10 billion.

As we announced this morning, we are raising the dividend by $0.08 to $1.08 per share, our 14th consecutive annual increase, and our Board of Directors has increased our share repurchase authorization to $10 billion. This capital allocation policy will allow us to maintain the balance we’ve talked about, invest organically in the businesses, maintain a strong balance sheet, and return capital to shareholders.” – CFO, Q4 conference call

The bottom line is that Comcast owns some of the best media and telecom assets in America, which generate stable, recurring income. That’s what makes it a great long-term dividend growth blue-chip.

Reason 2: A Strong Growth Runway

You might not expect a telecom to be a fast-growing company and if you only look at the top line, you’d be right.

CMCSA Medium-Term Growth Consensus Forecast

Year Sales Free Cash Flow EBITDA EBIT (Operating Income) Net Income
2020 $103,564 $13,280 $30,826 $17,493 $10,534
2021 $115,698 $14,830 $34,605 $21,055 $14,199
2022 $122,301 $15,724 $38,315 $24,473 $15,958
2023 $125,608 $17,926 $40,957 $27,221 $18,115
2024 $130,363 $20,805 $43,061 $29,596 $19,418
2025 $132,892 $22,467 $44,642 $30,675 $20,419
2026 $137,878 $22,870 $46,500 NA $21,024
Annualized Growth 4.89% 9.48% 7.09% 11.89% 12.21%

(Source: FactSet Research Terminal)

Analysts expect Comcast to grow at a modest 5% as far as sales go. But its bottom line is expected to grow a lot faster, double-digits in fact.

That’s due to some of the best economies of scale in the industry, which management plans to keep improving through disciplined cost-cutting.

(Source: FactSet Research Terminal)

It’s not subscriber growth that analysts expect to drive CMCSA’s top and bottom-line growth but steady and rapid increases in average revenue per user, or ARPU.

  • 12.4% CAGR growth in ARPU from 2020 through 2025

That’s why CMCSA is planning to increase spending for Peacock to $5 billion per year, to better help it monetize its existing asset base and amortize its costs across a larger and more diversified revenue stream.

That’s how you can drive steady margin growth and 15% long-term earnings growth (combined with healthy buybacks) even with a slow but steady decline in cable subscriptions.

CMCSA Long-Term Growth Outlook

  • 14.7% to 18.1% CAGR growth consensus range
  • 15.1% CAGR median growth forecast
  • smoothing for outliers historical analyst margins of error are 5% to the downside and 15% to the upside
  • 13% to 21% CAGR historical margin-of-error adjusted growth consensus range

CMCSA is expected to grow at similar rates as the last 13 years, a period that has seen very steady cord-cutting that analysts fully expect to continue.

Remember the growth thesis for Comcast isn’t that cable subscribers will grow.

It’s that Comcast will be able to better monetize its overall customer base, and keep growing despite secular headwinds in one of its core businesses.

  • much like tobacco companies keep growing despite falling cigarette volumes

Reason 3: A Wonderful Company At Anti-Bubble Valuations

In the modern cord-cutting era, CMCSA’s historical fair value is between 17.5 and 18.5X earnings.

Metric Historical Fair Value Multiples (13-Years) 2020 2021 2022 2023

12-Month Forward Fair Value

13-Year Median Yield 1.68% $54.76 $59.52 $59.52 $64.29
Earnings 18.12 $47.29 $57.71 $67.41 $76.47
Average $50.75 $58.60 $63.22 $69.85 $63.73
Current Price $49.92

Discount To Fair Value

1.64% 14.82% 21.04% 28.53% 21.67%

Upside To Fair Value (NOT Including Dividends)

1.67% 17.39% 26.65% 39.92% 27.67%
2022 EPS 2023 EPS 2021 Weighted EPS 2022 Weighted EPS 12-Month Forward EPS 12-Month Average Fair Value Forward PE

Current Forward PE

$3.72 $4.26 $3.43 $0.33 $3.76 16.9 13.3

(Source: Dividend Kings Research Terminal, FactSet)

Comcast is worth about 17X earnings and today trades at 13.3.

Not only is that a very attractive valuation for a Super SWAN quality company growing at 15%, but it actually understates just how attractively valued CMCSA really is.

CMCSA is trading at 8.5X EV/EBITDA right now.

  • enterprise value = market cap + net debt
  • EV/EBITDA is “the acquirer’s multiple”
  • Joel Greenblatt and private equity’s favorite valuation metric

How low is 8.5X EV/EBITDA? According to the Graham/Dodd fair value formula it potentially means CMCSA is priced for zero growth.

15% is actually what is expected.

In the first 10 seasons of Shark Tank, the average EV/EBITDA multiple was 7.0.

Pre-pandemic the average private equity deal was closing at 12.3 EV/EBITDA and after the pandemic that rose to over 13.

Today you can buy CMCSA as an anti-bubble stock, at least looking at its acquirer’s multiple.

  • a hyper-growth Super SWAN trading at private equity valuations

Analyst Median 12-Month Price Target

Morningstar Fair Value Estimate

$62.47 (14.7 PE) $60.00 (16 PE)

Discount To Price Target (Not A Fair Value Estimate)

Discount To Fair Value

20.25% 16.97%

Upside To Price Target (Not Including Dividend)

Upside To Fair Value (Not Including Dividend)

25.39% 20.43%

12-Month Median Total Return Price (Including Dividend)

Fair Value + 12-Month Dividend

$63.55 $61.08

Discount To Total Price Target (Not A Fair Value Estimate)

Discount To Fair Value + 12-Month Dividend

21.61% 18.43%

Upside To Price Target ( Including Dividend)

Upside To Fair Value + Dividend

27.56% 22.60%

(Source: Dividend Kings Research Terminal, FactSet)

Analysts expect 28% total returns from CMCSA in just the next year, and 20% of that would be justified by its fundamentals and valuation.

For anyone comfortable with CMCSA’s risk profile, it’s a potentially strong buy at a 15% historical discount to fair value, and here’s why.

Total Return Potential: Buy Comcast Today And You’ll Thank Me Tomorrow

For context, here’s the return potential of the 18% overvalued S&P 500.

Year EPS Consensus YOY Growth Forward PE Blended PE Overvaluation (Forward PE)

Overvaluation (Blended PE)

2021 $203.82 48.69% 23.5 23.1 37% 31%
2022 $222.51 9.17% 19.9 21.7 16% 23%
2023 $245.41 10.29% 18.1 19.0 5% 8%
2024 $274.74 11.95% 16.1 17.1 -6% -3%
12-Month forward EPS 12-Month Forward PE Historical Overvaluation PEG 25-Year Average PEG S&P 500 Dividend Yield

25-Year Average Dividend Yield

$223.57 19.823 17.78% 2.33 3.62 1.45% 2.01%

(Source: DK S&P 500 Valuation And Total Return Tool) updated weekly

Stocks have already priced in almost all of the 100% EPS growth from 2020 through 2024 and is trading at 21.1X forward earnings.

  • 16.8 is the 25-year average

Analysts expect the S&P 500 to deliver about -8% total returns over the next two years.

Year Upside Potential By End of That Year Consensus CAGR Return Potential By End of That Year Probability-Weighted Return (Annualized)

Inflation And Risk-Adjusted Expected Returns

2027 35.17% 6.21% 4.66% 1.93%

(Source: DK S&P 500 Valuation And Total Return Tool) updated weekly

Adjusted for inflation, the risk-expected returns of the S&P 500 are about 2% for the next five years.

  • S&P’s historical inflation-adjusted returns are 6% to 7% CAGR

But here’s what investors buying CMCSA today can reasonably expect.

  • 5-year consensus return potential range: 16% to 22% CAGR

CMCSA 2023 Consensus Total Return Potential

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FAST Graphs, FactSet Research

According to analysts, CMCSA might not just deliver Buffett-like 24% returns in 2022 but for the next two years.

CMCSA 2027 Consensus Total Return Potential

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FAST Graphs, FactSet Research

  • if CMCSA grows as expected and returns to historical mid-range fair value
  • then 189% total returns or 20% CAGR
  • about 5x more than the S&P 500 consensus

CMCSA Investment Decision Score

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Dividend Kings

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Dividend Kings Automated Investment Decision Tool

For anyone comfortable with its risk profile, CMCSA is one of the most reasonable and prudent hyper-growth blue-chips you can buy in today’s rapidly reinflating and still overvalued market.

Risk Profile: Why Comcast Isn’t Right For Everyone

There are no risk-free companies and no company is right for everyone. You have to be comfortable with the fundamental risk profile.

CMCSA’s Risk Profile Includes

  • political/regulator risk (globally)
  • disruption risk (T-Mobile if now rolling out $50 per month 5-G home internet)
  • changing consumer tastes (difficulty achieving previous economies of scale with the rise of streaming for example)
  • M&A execution risk (including regulatory risk on this as well)
  • talent retention risk (tightest job market in over 50 years)
  • currency risk (grows over time as they expand internationally)
  • cybersecurity risk: hackers and ransomware

Comcast is expected to start to see shrinking subscribers within a few years and only very strong growth in average revenue per user is expected to result in strong bottom-line growth.

  • changing consumer tastes could result in ARPU growth not coming in as expected

How do we quantify, monitor, and track such a complex risk profile? By doing what big institutions do.

Material Financial ESG Risk Analysis: How Large Institutions Measure Total Risk

Here is a special report that outlines the most important aspects of understanding long-term ESG financial risks for your investments.

  • ESG is NOT “political or personal ethics based investing”
  • it’s total long-term risk management analysis

ESG is just normal risk by another name.” Simon MacMahon, head of ESG and corporate governance research, Sustainalytics” – Morningstar

ESG factors are taken into consideration, alongside all other credit factors, when we consider they are relevant to and have or may have a material influence on creditworthiness.” – S&P

ESG is a measure of risk, not of ethics, political correctness, or personal opinion.

S&P, Fitch, Moody’s, DBRS (Canadian rating agency), AM Best (insurance rating agency), R&I Credit Rating (Japanese rating agency), and the Japan Credit Rating Agency have been using ESG models in their credit ratings for decades.

  • credit and risk management ratings make up 38% of the DK safety and quality model
  • dividend/balance sheet/risk ratings make up 79% of the DK safety and quality model

Dividend Aristocrats: 67th Industry Percentile On Risk Management (Above-Average, Medium Risk)

CMCSA Long-Term Risk Management Consensus

Rating Agency Industry Percentile

Rating Agency Classification

MSCI 37 Metric Model 57.0%

BB, below-average

Morningstar/Sustainalytics 20 Metric Model 65.9%

24.7/100 Medium-Risk

Reuters’/Refinitiv 500+ Metric Model 91.4% Good
S&P 1,000+ Metric Model 40.0%

Below-Average (Stable Trend)

Just Capital 19 Metric Model 92.31% Excellent
Consensus 69.3% Above-Average
FactSet Qualitative Assessment Average Positive Trend

(Sources: MSCI, Morningstar, Reuters’, S&P, Just Capital, FactSet Research)

CMCSA’s Long-Term Risk Management Is The 198th Best In The Master List (60th Percentile)

CMCSA’s risk-management consensus is in the top 40% of the world’s highest quality companies and similar to that of such other companies as

  • Pembina Pipeline Corp (PBA)
  • Illinois Tool Works (ITW) – dividend king
  • Cardinal Health (CAH) – dividend aristocrat
  • Royal Bank of Canada (RY)
  • QUALCOMM (QCOM)
  • Consolidated Edison (ED) – dividend aristocrat
  • Verizon (VZ)

The bottom line is that all companies have risks, and CMCSA is above-average at managing theirs.

How We Monitor CMCSA’s Risk Profile

  • 38 analysts
  • 3 credit rating agencies
  • 8 total risk rating agencies
  • 46 experts who collectively know this business better than anyone other than management
  • and the bond market, the “smart money” on Wall Street

When the facts change, I change my mind. What do you do sir?” – John Maynard Keynes

There are no sacred cows at iREIT or Dividend Kings. Wherever the fundamentals lead we always follow. That’s the essence of disciplined financial science, the math retiring rich and staying rich in retirement.

Bottom Line: Buy Comcast Now Before Everyone Else Does

I can’t promise you that the fear we saw in the markets in January won’t return in a few weeks or even tomorrow.

According to a recent survey by Bank of America of 400 mutual fund managers, zero were expecting 4+ rate hikes in 2022.

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Daily Shot, Bloomberg

In contrast, the bond market is now all but certain we’re going to get five rate hikes this year and Bank of America and several Fed presidents think it could be as much as seven.

What does this mean in the short-term? That the stock market and bond market significantly disagree about interest rates this year.

Historically, when the stock and bond market disagree, the “smart money”, i.e. the bond market, is proven right.

That could mean that we might see this correction reverse, retest, and even break to new lows.

Or we could see record highs end the correction, and if the Fed comes through with five rate hikes (or more) we could see another, possibly deeper correction of 15% to 20%.

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Ben Carlson

The average non-recessionary correction since 1950 has seen stocks fall for about four months, by 15%.

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Ben Carlson

The average non-recessionary bear market has tended to be mild, about a 19% to 20% decline.

Including recessions, the average bear market sees stocks fall for 13 months, an average of 33%. It then takes about two years to get back to record highs.

  • the average bear market lasts three years from peak to a new record high

If there is any year in which elevated valuations and a tightening Fed could trigger a 15% to 20% correction, it’s 2022.

The main purpose of the stock market is to make fools of as many men as possible.” – Barnard Baruch

Of course, historical averages only give us an idea of what MIGHT happen, they don’t predict what will happen.

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Average Stock Gain During Fed Tightening Cycle Is 23% (Ben Carlson )

Finance is a science, but a statistical one, and there are no guarantees.

But what I can tell you is that no long-term investor, who avoided becoming a forced seller for emotional or financial reasons, has ever regretted buying Comcast at 13.3X forward earnings of 8.5X EV/EBITDA.

And based on a careful and thorough examination of the best available data we have today, I can say with 80% confidence that today is unlikely to be the first time.

This is why I bought more Comcast for my retirement portfolio recently and you might want to do the same.

Luck is what happens when preparation meets opportunity.” – Roman Philosopher Seneca the Younger

Because in a market that was still overvalued when it might have bottomed and is now potentially roaring back to record highs, great blue-chip bargains are still plentiful if you know where to look.

If you’re searching for world-class quality, hyper-growth, and attractive valuation, consider Comcast.

If you are tired of fretting over every market downturn, consider Comcast’s very safe and steadily growing dividends.

If you’re tired of praying for luck on Wall Street, then it’s time to stop gambling and start investing in blue-chips like Comcast.

After carefully examining the data, I have just one conclusion when it comes to this hyper-growth Super SWAN.

Buy Comcast now before everyone else does.



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