Comcast (CMCSA) announced that it is officially spinning off its cable networks to shareholders in a tax-free deal, with the SpinCo networks including USA Network, CNBC, MSNBC, Oxygen, E!, SYFY, and the Golf Channel, as well as related digital assets including Fandango and Rotten Tomatoes, Raymond James tells investors in a research note. The firm, which made no change to its Market Perform rating, believes this is being done to separate the part of the business that is likely to face increasing challenges over the next several years, and thinks the valuation for SpinCo will be lower than where the parent is currently trading, even though it is likely a cash cow for multiple years. The dis-synergies and limited pricing power for fees make for a difficult time as a standalone business, Raymond James argues.
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