Comcast (CMCSA) Turns On The After-Burners

Revenue at Comcast (CMCSA) grew 14% in the fourth quarter to over $8 billion and operating income was up 20% to almost $1.5 billion. EPS came in a $.20, up 54%. Analysts had been expecting $.17.

The company also initiated a dividend of $.25

The company forecast free cash flow growth of 20% in 2008 and revenue growth of 8% to 10%.

Video revenue increased 7% to $17.7 billion in 2007, reflecting growth in digital cable customers and increased demand for advanced digital features including ON DEMAND, DVR and HDTV, as well as higher basic cable pricing.

During the year, 1.8 million additional digital cable customers subscribed to advanced services, like DVR and HDTV, either by upgrading their digital cable service or as new customers. As of December 31, 2007, 6.3 million, or 42% of our digital cable customers received advanced services, 5.4 million, or 36% received full digital cable, and 3.5 million, or 23% were digital starter subscribers.

High-speed Internet revenue increased 18% to $6.4 billion in 2007, reflecting a 1.7 million or 15% increase in subscribers from the prior year and relatively stable average monthly revenue per subscriber of approximately $43. Comcast ended 2007 with 13.2 million high-speed Internet subscribers, or 27% penetration of homes passed.

Phone revenue increased 85% to $1.8 billion due to significant growth in CDV subscribers, offset by a $229 million, or 50% decline in circuit-switched phone revenues as Comcast transitions to marketing CDV in most areas. Comcast ended 2007 with a total of 4.4 million CDV customers or 10.4% of available homes.

Perhaps now the stock, which trades at $17.81, near a 52-week low, can trade back up again

Douglas A. McIntyre