Comcast shares fall on earnings projections

first_imgComcast is considering offering lower-priced services, such as an Internet and phone bundle, for customers who don’t get its cable TV. This is a “cultural shift” for the company, Angelakis said. Comcast has decided to spend heavily on advanced set-top boxes. That higher spending doesn’t necessarily bring in new customers since it tends to be marketed as an upgrade to current subscribers.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREPettersson scores another winner, Canucks beat KingsThe stock lost $1.81, or 8.7 percent, to close at $18.92 after earlier trading as low as $18.08. In the past year, the stock has ranged from $18.83 to $30.18. The news also pressured other cable stocks: Time Warner Cable Inc. slid 4.4 percent to $25.87 while shares of Cablevision Systems Corp. fell 4.2 percent to $25.76. “We’ve seen a real softness in the business related to a combination of … macroeconomic issues and markets, and you’ve seen some competitive intensity,” Michael Angelakis, Comcast’s co-chief financial officer, said Wednesday at the UBS Global Media and Communications Conference in New York. Cable stocks have struggled in 2007 on worries of stricter regulations, a slowing economy and competition from phone companies as they lured customers with their video services. Cable had enjoyed an advantage of being able to deliver video, Internet and phone services through one provider. “Competition has increased and we’ve got to respond,” Angelakis said. But “the expectation that I have is, over the next couple of years, we will lose some share on the video side.” PHILADELPHIA – In a bad year for cable stocks, Comcast’s fall has been downright ugly. Shares tumbled to a 20-month low Wednesday after the nation’s largest cable operator disclosed that this year’s revenue growth and cash flow will come in lower than expected. Comcast said consumers were balking at increasing their spending in a slowing economy, and phone companies had stepped up competition. Comcast also raised capital spending to push its advanced digital set-top boxes and its digital services. “Comcast’s announcement today is the worst of all possible worlds,” said Craig Moffett, senior analyst at Sanford Bernstein. “The promise of the cable stocks has always been as growth decelerates, so too will capital intensity, and free cash flow will rise.” last_img

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