Influential media analyst Jessica Reif Cohen increased her 12-month price target on Comcast to $45 per share from her previous target of $39, citing strong momentum in voice- and digital-subscriber additions.
The new price target represents about a 23% upside to the stock’s current price -- it closed at $36.62 per share Thursday, down 69 cents. Comcast shares have been on a roll all year, rising more than 41% ($10.69 each) from their Jan. 3 price of $25.93.
Reif Cohen also increased her 2007 estimates for revenue growth (11.7% vs. 10.1%) and cash-flow growth (13.2% vs. 11.5%).
She also raised her third-quarter estimates for digital-voice additions (420,000, an increase of 38,000), adding that she now expects digital-voice additions for full-year 2006 to be 1.4 million, an 18% increase to her previous estimates.
Reif Cohen also projected that Comcast will grow cash flow at a rate of 12% per year from 2007-10 and that free cash flow will rise from $3.2 billion in 2007 to $7.1 billion in 2010 (a 31% compound annual growth rate).
“The rollout of voice is driving the success of the bundled offer, while existing penetration rates still provide ample room for three- to five-year growth,” Reif Cohen wrote.
The price-target increase appeared to have little early effect on Comcast stock -- shares were down seven cents each to $36.55 per share in early trading Friday.
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