As the Q1 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers in the cable and satellite industry, including Comcast (NASDAQ:CMCSA) and its peers.
The massive physical footprints of fiber in the ground or satellites in space make it challenging for companies in this industry to adjust to shifting consumer habits. Over the last decade-plus, consumers have ‘cut the cord’ to their traditional cable subscriptions in favor of streaming options. While that is a headwind, this affinity to streaming means more households need high-speed internet, and companies that successfully serve customers can enjoy high retention rates and pricing power since the options for internet connectivity in any geography is usually limited.
The 6 cable and satellite stocks we track reported a weak Q1; on average, revenues were in line with analyst consensus estimates. while next quarter's revenue guidance was 1.9% below consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, but cable and satellite stocks have shown resilience, with share prices up 5.9% on average since the previous earnings results.
Best Q1: Comcast (NASDAQ:CMCSA) Formerly known as American Cable Systems, Comcast (NASDAQ:CMCSA) is a multinational telecommunications company offering a wide range of services.
Comcast reported revenues of $30.06 billion, up 1.2% year on year, in line with analysts' expectations. Overall, it was a mixed quarter for the company.
Comcast pulled off the fastest revenue growth of the whole group. The stock is down 3% since reporting and currently trades at $38.95.
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Sirius XM (NASDAQ:SIRI) Known for its commercial-free music channels, Sirius XM (NASDAQ:SIRI) is a broadcasting company that provides satellite radio and online radio services across North America.
Sirius XM reported revenues of $2.16 billion, flat year on year, outperforming analysts' expectations by 1.4%. It performed better than its peers, but it was unfortunately a slower quarter for the company with a miss of analysts' core subscribers and earnings estimates.
Sirius XM achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 22.3% since reporting. It currently trades at $3.89.
Weakest Q1: Cable One (NYSE:CABO) Founded in 1986, Cable One (NYSE:CABO) provides high-speed internet, cable television, and telephone services, primarily in smaller markets across the United States.
Cable One reported revenues of $404.3 million, down 4.2% year on year, falling short of analysts' expectations by 1%. It was a weak quarter for the company with a miss of analysts' earnings estimates.
Cable One had the weakest performance against analyst estimates in the group. As expected, the stock is down 13.3% since the results and currently trades at $343.69.
WideOpenWest (NYSE:WOW) Initially started in Denver as a cable television provider, WideOpenWest (NYSE:WOW) provides high-speed internet, cable, and telephone services to the Midwest and Southeast regions of the U.S.
WideOpenWest reported revenues of $161.5 million, down 6.2% year on year, in line with analysts' expectations. Taking a step back, it was a weak quarter for the company with a miss of analysts' earnings estimates and revenue guidance for next quarter missing analysts' expectations.
WideOpenWest had the slowest revenue growth among its peers. The stock is up 11.3% since reporting and currently trades at $5.40.
Charter (NASDAQ:CHTR) Operating as Spectrum, Charter (NASDAQ:CHTR) is a leading telecommunications company offering cable television, high-speed internet, and voice services across the United States.
Charter reported revenues of $13.68 billion, flat year on year, in line with analysts' expectations. Overall, it was a weaker quarter for the company with a miss of analysts' earnings estimates.
The stock is up 25.1% since reporting and currently trades at $324.50.
This content was originally published on Stock Story
