Media, entertainment, and technology giants have recently reported their quarterly earnings, revealing challenges in advertising and continued cord-cutting. However, some companies, such as Comcast, Charter Communications, and Roku, are leaving earnings season with improved investor sentiment and positive reviews from Wall Street analysts.
According to Wells Fargo analyst Steven Cahall, Comcast, Charter, and Roku have seen more stable growth despite competition and are returning to stronger growth in their respective markets. He also noted that sentiment towards other key stocks, such as Disney, Warner Bros. Discovery, Spotify, and Nexstar, has improved but not significantly.
Cahall argues that the more positive outlook on Comcast and Roku is justified based on their earnings updates and conference call commentary. He explains that stocks tend to follow earnings revisions, and downward revisions have mostly affected ad-centric stocks.
Comcast, the cable titan and owner of NBCUniversal and Sky, reported better-than-expected results in various units. Goldman Sachs analyst Brett Feldman highlighted the company’s improved operating momentum and visibility across its key businesses. He maintained his “buy” rating on Comcast shares and raised his stock price target.
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Bank of America analyst Jessica Reif Ehrlich also raised her Comcast stock price target, citing the company’s strong quarterly figures and solid performance across its various segments. Pivotal Research Group analyst Jeff Wlodarczak echoed this sentiment, noting that Comcast reported solid second-quarter results and highlighted the resilience of its data plant.
Charter Communications, another cable giant, gained praise for its lower-than-expected pay TV subscriber losses and return to broadband customer growth. Wells Fargo analyst Steven Cahall increased his stock price target for Charter and noted that the company’s customer acquisition, particularly in rural areas, is exceeding expectations. TD Cowen analyst Gregory Williams maintained his “outperform” rating on Charter and highlighted the company’s strong broadband and mobile subscriber adds.
Roku, a streaming device maker, has faced challenges in the ad market and competitive streaming market. However, its latest earnings report provided upside surprises and increased analysts’ confidence in its outlook. Evercore ISI analyst Shweta Khajuria maintained his “in line” rating on Roku shares but raised his stock price target, citing the magnitude of the beat in the company’s second-quarter results. Macquarie analyst Tim Nollen reiterated his “outperform” rating and praised Roku’s efforts to diversify its ad base.
Overall, while the media, entertainment, and technology industry faces challenges in advertising and cord-cutting, some companies are emerging from earnings season with improved investor sentiment and positive reviews from analysts. Comcast, Charter Communications, and Roku are among the stocks that have gained praise for their performance and outlook.
