KeyBanc gets bearish on Comcast as broadband competition intensifies

Investing.com -- KeyBanc Capital Markets has downgraded Comcast to Underweight from Sector Weight on Friday, setting an $18 price target on the company’s shares.

The firm warned that the cable operator's key businesses are weakening.

"In short, we think every key metric is likely worse than expected," analyst Brandon Nispel wrote. He pointed to worsening broadband subscriber numbers, pressure on connectivity earnings in the fourth quarter and a sharper-than-expected decline at theme parks.

KeyBanc stated that rivals' 1-gigabit offers at $30 to $40 a month are winning customers. It cut its third-quarter broadband net additions forecast to a loss of 140,000 customers from a loss of 125,000. Consensus expects a loss of 119,000.

For 2026, KeyBanc now sees a loss of 558,000, and for 2027 a loss of 665,000. That is below the consensus of 482,000, which assumes improvement.

Nispel said Comcast can either refuse to match rivals' prices and lose more customers, or match them and take a hit to average revenue per user. "Neither situation is a positive outcome, in our view," he wrote.

The analyst added that only about 55% of Comcast's footprint faces fiber competition, so that pressure could grow.

KeyBanc also doubts that earnings from Comcast's connectivity and platforms business will improve in the fourth quarter as consensus expects.

“We don't view the spin-off of NBCU as a catalyst as the fundamentals of the key assets of both businesses are deteriorating and multiple compression is still possible,” said Nispel. “We see risk to shares.”

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