It’s Time to Buy CMCSA Stock on Comcast’s Split News

Comcast (CMCSA) opened Monday’s trading up nearly 17% on news that the company would spin off its NBCUniversal and Sky media and entertainment businesses, keeping the cable, wireless, and broadband businesses, along with up to a 19.9% stake in the spinoff.  

That’s welcome news to long-suffering Comcast shareholders. The company has faced a conglomerate discount for years because of the perceived lack of synergy between the two businesses. Certainly, the nasty divorce between Time Warner and AT&T (T) is but one example of disparate tie-ups gone wrong. 

As a result of investor skepticism about Comcast’s strategy, CMCSA shares haven’t traded this low since May 2014. Shares traded $8 higher in October 2018 after Comcast completed its $40 billion all-cash acquisition of Sky. They peaked at $61.80 in September 2021. They’ve been downhill ever since.

Whether you are skeptical or not about the company’s plans to split into two businesses, I don’t think there’s any question that value investors should be intrigued by Comcast’s shares at current prices.

Yesterday’s bullish price surprise might be a dead cat bounce, or it might be the beginning of a retracement of its share price to its all-time high in the $60s.

Here’s a look at both sides of the argument.

Walt Disney Provides a Good Example 

As Walt Disney (DIS) can attest, investors often don’t give enough credit to the parks segment of a large media and entertainment business. 

The House that Walt Built is currently valued at $215.22 billion, about 2.3 times revenue and 15.1 times its trailing 12-month operating income. Disney closed at $98.63, about 24% lower than the analysts’ median target price of $130, according to S&P Global Market Intelligence. 

In fiscal 2025 (September year-end), the company’s retail and merchandise licensing businesses, which operate within the Experiences segment, accounted for 12% of the Experiences segment’s $36.16 billion in annual revenue. Disney’s global resorts, cruise line, vacation ownership, and experiences businesses accounted for 88% ($31.82 billion) or 38% of Disney’s overall revenue.

In 2025, the operating margin of its Experiences segment was 27.7%, more than double the 11.0% for Entertainment and 16.3% for its Sports segment. Furthermore, the Experiences segment’s operating income was 57% of Disney’s overall profits before interest and taxes.

It is Mickey Mouse’s cash flow machine. 

If investors valued the Experiences business at 20x operating income, rather than the 15.1x multiple for the whole business, its enterprise value alone would be $206.36 billion (TTM operating income of $10.32 billion), or 96% of Disney’s. 

How Does Comcast Apply to Disney?

While a comparison of Disney and Comcast is apples and oranges, there are some similarities between the two companies and their undervalued stocks.

In January, Comcast began the process of untangling its many businesses by spinning off its legacy cable businesses -- CNBC (now MS NOW, USA Network, Golf Channel, SYFY, etc. -- into Versant Media Group (VSNT). Existing shareholders received 1 Versant Class A or Class B share for every 25 Comcast Class A or Class B shares held. Versant has an enterprise value of $6.96 billion, 4% of Comcast’s current market cap of $171.84 billion. 

Versant is valued at about 5.8 times operating income, while Comcast is valued at 9.0 times operating income. 

Let’s assume that Comcast’s non-telecom businesses, which operate under the Content & Experiences (C&E) segment, are valued at 20 times operating income as I did earlier for Disney.

This segment includes NBC, NBCUniversal’s cable network, Peacock DTC (direct-to-consumer) streaming platform, NBC Sports, Universal Pictures, DreamWorks Animation, Universal Television, Universal Theme Parks, and many others.  

In fiscal 2025 (December year-end), C&E accounted for 37% of its $123.7 billion in revenue and 17% of its $37.38 billion in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization).

So, the C&E segment contributed about the same percentage of revenue as Disney’s Experiences business. Meanwhile, the segment’s adjusted EBITDA contribution to Comcast was about one-third the Experiences contribution to Disney. And I used Disney's operating income, not adjusted EBITDA. If I had, the comparison would be even worse. 

Is Comcast Undervalued?

Yesterday’s big jump would suggest it is. 

So, the questions to ask are twofold: 1) How much should C&E be valued as a standalone business? and 2) What is the valuation of the remaining cable, wireless and broadband assets? 

To figure this out, I’ll use the Q1 2026 results, the first quarter without Versant.

The C&E segment’s revenue in Q1 2026, excluding the Super Bowl and Olympics, was $9.76 billion, 14.2% higher than in Q1 2025. Meanwhile, the segment’s adjusted EBITDA was $680 million, or 7.0% of its revenue. 

In the trailing 12 months, the segment’s adjusted EBITDA was $5.28 billion, including costs associated with operating at Comcast’s headquarters in Philadelphia.

If I apply the same 20x multiple as Disney -- very generous given depreciation and amortization are included -- that would give C&E an enterprise value of $105.6 billion. 

Let’s assume the Connectivity & Platforms segment is valued at 5.0 times EBITDA, the current multiple for the whole company, given its slower growth. Based on the trailing 12-month EBITDA of $32.0 billion, it would be valued at $160 billion.  

Together, the two businesses could be worth as much as $265.6 billion operating as two independent companies, about 55% higher than their current enterprise value of $171.84 billion. 

That puts the value of Comcast shares at $51, well above where it currently trades.

If you’re bullish about the split, buying now makes sense.