Is Comcast an Attractive Investment?

With shares of Comcast (NASDAQ:CMCSA) trading around $51, is CMCSA an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Comcast is a provider of entertainment, information, and communications products and services. The company operates in five segments: cable communications, cable networks, broadcast television, filmed entertainment, and theme parks. Comcast offers television, video, high-speed Internet, and voice services to residential and business customers. It also operates NBC and Telemundo broadcast networks; provides filmed entertainment under the Universal Pictures, Focus Features, and Illumination names; and operates theme parks, studios, and a dining, retail, and entertainment complex.

A new challenger enters — or any phrase along those lines — would likely ring in the ears of gamers anywhere upon hearing that Comcast has plans to get a competitive place in the gaming universe by partnering with another big name, Electronic Arts (NASDAQ:EA), according to an exclusive Reuters report. The idea is to offer all the living room fun of a console with a lot more ease and what may feel like a lot less expense, but the reality might not be as planned. According to the report, inside sources informed Reuters that Comcast was making arrangements with EA to stream certain video games through its X1 cable box — and yes, that is one word and a small shift away from sounding a lot like Xbox One, but it’s a long way away from being like one.

It wouldn’t be the first company to pull a trick like this in the living room, but it’s doing it in a less common way, and with competitors nipping at it from all around, it had little choice. The system would function by using cloud-gaming, since the X1 cable box is by no means a gaming machine with all the processing powers or GPU performance necessary to handle crunching modern game data, though it is powerful as far as cable  boxes go, offering more in the way of apps and functionality, according to Reuters‘ sources. Cloud-gaming does all the processing in servers elsewhere, then streams the visuals and audio back to a screen for the player to see and respond to — it’s essentially like having a controller and screen that are wirelessly connected to a gaming console that is very far away from the living room.