Wolfe Research raised Comcast (NASDAQ:CMCSA) to Peer Perform from Underperform, removing its previous price target for the stock in a note Wednesday.
Wolfe analysts said the firm is now raising its CY23E EBITDA forecast for CMCSA by 2%.
"Broadband flow share is near a bottom & should return to duopoly by '26," they wrote. "We believe that beyond the 2022-25 disequilibrium phase, the broadband industry structure supports L-MSD % pricing power and positive volumes. As such, we think CMCSA's EBITDA multiple should at least hold up, driving a 12%+ return (from buybacks + EBITDA growth + dividends)."
The analysts also stated that the company's losses from Peacock are priced-in, while free cash flow should grow more than 10% per year.
"We estimate the combination of organic EBITDA growth, EPIC Universe turnaround from investment to positive FCF contributor and buybacks can drive $5.16/s in FCF in 2026E up from $3.55/s in 2023 (+21% CAGR)." they added.