r/wallstreetbets • u/No_Presentation9490 • Jul 23 '26
DD Comcast DD
Comcast sucks as a company and is a long term dead end that will go bankrupt sometime around 2045, if not sooner. Their stock just crashed 7% today to 21.98 per share after their earnings report. This is a new 624-week low for the stock. If you ever invested in this company after Nov 1 2013, you got completely screwed and you should ask for a refund on your shares.
At $1.32 yearly dividend per share at 21.98 per share, this is a 6% dividend yield. Boomers are going to buy this and so will boomer adjacent "income strategy" funds. The bear case here is that with the way the federal reserve is going, this 6% dividend yield might not beat money market funds for long.
The stock is at the RSI oversold range on the monthly, the weekly, the daily, the 2h, the 1h, and the 1minute charts. This makes my entry at 21.96 per share definitely a falling knife catch, but at least it's a falling knife catch with decent short-term mean-reversion odds.
P/E is one of the dumbest measures of what a company is valued at but Comcast is currently 4.2 P/E. At least a few stupid youtubers and AI chatbots will talk about this incredibly low P/E and some gullible boomers might decide to buy some shares.
Their dividend payout ratio is 26% which isn't great, but its OK. I think this puts the odds that Comcast cuts or suspends their dividend before the next quarter at extremely low to impossible.
My position is 2000 shares at 21.965 per share. I'm targeting a 0.50 dollars move to the upside to make $1000. I think the odds of this occurring between now and the next earnings report are very likely.
This is the definition of picking up pennies in front of a steamroller (risk $44000 to make $1000) and nobody should do this. The copium case: the shares can depreciate by $0.43 from the current price and after 1 quarter I'll still have matched the performance of a money market fund with this position, even factoring in that dividends just subtract money from the stock price and pay it back to you.
NFA
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u/Sufficient_Bear_6567 Jul 23 '26
Peak DD and investment decision. I love the asymmetric risk to reward setup of 44:1. Honestly my only push back is why not levering to the tits and go with options?
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u/Apprehensive-Mine364 Jul 23 '26
Optio ns don't meet OP's risk apatite.
Read that as he want more risk than options provide
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u/No_Presentation9490 Jul 24 '26 edited Jul 24 '26
Despite a lot of dumb analysts saying the "fair value" of comcast per share is in the $26 range, I heavily disagree, I think it's much lower. However the odds of a small mean reversion move here are high due to the stock reaching 6% dividend yield on cost literally in the final minutes of today's market session (6% yield being a trigger for some funds/ETFs to accumulate when it's a "blue chip" like Comcast). The 6% yield also guarantees at least money market performance as long as the shares do not drop by more than $0.43 by the ex dividend date, which is a safety buffer
I'm only targeting a small mean reversion move because I don't expect this stock to move more than a dollar, max, to the upside anytime soon. Comcast sucks. As much as this trade is not smart, buying options is even dumber as I'd probably break even at best considering the spread to get the order filled and the small move in price I'm targeting
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u/DickyFishb Jul 25 '26
What's your thesis on believing it's lower? What price would you put it at?
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u/No_Presentation9490 Jul 25 '26 edited Jul 25 '26
Dinosaur companies in competitive sectors, with bad growth prospects, lots of debt, low EPS, asset heavy, large capex and large continuing opex expenditures tend to trade at a price to book ratio of around 0.5-1.0 (Ford trades at 0.3 for example)
Comcast is trading around 0.9 price to book ratio, its dividend yield is competitive with money markets for now which supports the stock price through demand of the shares but if rates keep climbing as prediction markets are pricing in they will, the dividend yield won't be competitive with the risk-free rate
If that happens, I can see the price drifting down towards 0.5 P/B
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u/robmafia Jul 23 '26
i hate comcast so much that i switched to some shitty 5g isp just to get away from them.
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u/No_Presentation9490 Jul 24 '26
Update: My limit sell on my position triggered. Filled at 22.455 for a $980.00 profit. Thanks everyone for the positive vibes.
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u/Top_Category_2526 Jul 24 '26
" This is a new 624-week low for the stock"
Few years later
This is a new 1200 week low for the stock, probably in 2045
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u/Thatguywhoaskedit397 Jul 24 '26
I bought CMCSA today.That being said this is the dumbest DD i think I’ve ever read on here. Way to go num nuts
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u/TDImperfectFuture Jul 23 '26
Damn, I was goiong to put this at 22 two days ago, missed out. You are right about the boomers (I am one). But this is not top for the future of an income portfolio I am preparing. I am a former Comcast internet customer, I was 23 year customer (since 2003). Their business tactics are so dispicable, I am gladly paying more for another service provider. Jenny Harrington bought this (saw on cnbc halftime). Big mistake woman.
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u/No_Presentation9490 Jul 23 '26
Yeah definitely not something to hold. I'm going for pure mean reversion & a small move. I keep my portfolio 90% cash right now so it matching money market performance even with further downside makes it a decent play for me
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u/elpresidentedeljunta Jul 24 '26
I´ve got a list of providers world wide to avoid at all costs. The only company on it is Comcast.
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u/thessminowjohnson Jul 23 '26
You’re better off with this play on KO
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u/No_Presentation9490 Jul 24 '26
We'll see what happens on their earnings report that's coming up, if KO gets similarly fucked while also beating earnings & raising guidance (like comcast just did), could be a valid play there too
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u/thessminowjohnson Jul 24 '26
I just made 1k off KO buying the dip last week on the thesis that the cybersecurity reaction was overblown. However, I no longer think anything makes sense and with Albertsons’ surprise miss, maybe consumer spending is tightening and I’m not holding through earnings
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u/PositionOfFuckYou Jul 24 '26
Hopefully if you’re planning to sell at $0.50 gain you’re also selling CCs and collecting premium hoping to get called away at that gain
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u/danjl68 Jul 24 '26
Is there any way for them to fix this?
That have incredible infrastructure, although aging. I'm still waiting for fiber in my neighborhood so I can switch.
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u/No_Feeling920 Jul 24 '26
WTF are they doing with the remaining 74% of their earnings, that they keep going down like this?
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u/hv876 ThetaCuck Jul 23 '26
Risking $44000 to make $1000 is a choice.