Cable giant Comcast Corp. (CMCSA) is in talks to team up with Walmart to develop and distribute smart TVs, according to a Wall Street Journal report. The report said that the move comes as Comcast is looking to expand its business in the growing video-streaming space.
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According to the report, Walmart (WMT) could receive recurring revenues for promoting TVs running Comcast software. The smart TV partnership would also help Comcast to promote its NBC Universal’s new streaming service, Peacock.
While Comcast did not comment on the discussions, Ryan Peterson, Walmart’s vice-president of electronics told the Wall Street Journal that “We’re constantly having conversations with current and new suppliers about innovation and new products we can bring to our customers, and we don’t share details of those discussions.”
On Oct. 29, Comcast’s 3Q posted earnings of $0.65 per share that declined 17.7% year-over-year but topped the Street estimates of $0.52 per share. The media giant’s revenues of $25.5 billion beat the consensus estimates of $24.7 billion but declined 4.8% year-over-year. In 3Q, Comcast Cable lost 273,000 video subscribers while it added 633,000 broadband customers. (See CMCSA stock analysis on TipRanks)
Following the 3Q results, Oppenheimer analyst Timothy Horan maintained a Hold rating on the stock. Horan noted that the upbeat 3Q results came from “stronger broadband growth and cost reductions.” The analyst added that “video losses decelerated sequentially and should be stable next quarter.” NBCUniversal “appears to be recovering better than expected, but will remain volatile due to the pandemic,” he commented.
Currently, the Street has a bullish outlook on the stock. The Strong Buy analyst consensus is based on 9 Buys and 3 Holds. The average price target of $53.90 implies upside potential of about 26.5% to current levels. Shares are down 5.2% year-to-date.
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