via Fierce Cable
by Daniel Frankel
June 20, 2017
The cable industry’s days of flying under Wall Street’s radar with an underappreciated “infrastructure advantage” are over, argues MoffettNathanson analyst Craig Moffett, who downgraded the cable industry, and its leading operator, to “neutral” trading status today.
Comcast, which had been rated “buy,” has tripled in stock value over the past five years, the analyst noted, with cable stocks viewed as a “contrarian purchase,” going against commonly held notions that over-the-top video would crush the industry.
For its part, Charter Communications has seen its stock price quadruple over the same five-year span, with savvy investors climbing beyond the noise “about video cord-cutting and risks to the relatively less important video aggregation layer,” and yielding handsome rewards.
“But as any mountain climber knows, the higher you go, the thinner the air is,” Moffett added.
The analyst believes the market has corrected its undervaluation of the U.S. cable industry, and that gravity is about to pull stock prices back to earth