Comcast (CMCSA) Stock Closes Lower as ViacomCBS (VIAC) and Roku Surge on News of Impending Deal

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by Benjamin Godfrey · 3 min read
Comcast (CMCSA) Stock Closes Lower as ViacomCBS (VIAC) and Roku Surge on News of Impending Deal
Photo: Depositphotos

The report of the proposed deal Comcast is considering has been flagged down as pure speculation by the firm’s spokesperson.

The shares of the American telecommunications company Comcast Corporation (NASDAQ: CMCSA) have slipped upon news the firm is considering a deal with players in the content streaming niche. Per a Wall Street Journal report, the company made its foray into the world of entertainment about a decade ago when it acquired NBCUniversal. Following the success of that venture, the firm is now exploring a shift into streaming services to take the battle to Roku Inc (NASDAQ: ROKU), and Inc (NASDAQ: AMZN).

The potentials of streaming services were made manifest during the COVID-19 pandemic. As people sought safety in their homes, many took to content streaming to find entertainment and solace from the pains of the lockdowns. Streaming services providers were on the receiving end as subscription rates climbed higher, per an earlier Coinspeaker report on Netflix Inc (NASDAQ: NFLX).

Per the plans of Comcast with respect to its foray into streaming, the WSJ noted the firm is considering a yet to be disclosed deal with CBS Corporation (NASDAQ: VIAC) popularly called ViacomCBS, or the complete acquisition of Roku. Following the news, CMCSA closed Wednesday’s trading session with a loss of 3.73% to $55,48 per share. ROKU and VIAC jumped 4.51% and 2.67% to $421.70 and $41.84 respectively.

The Proposed Comcast Deal Is a Speculation

The report of the proposed deal CMCSA is considering has been flagged down as pure speculation by the firm’s spokesperson according to CNBC. Nonetheless, the company’s Chief Executive Officer, Brian Roberts is notably considering options to form partnerships that will bring the Comcast streaming software into Smart TVs. This is to directly give a good competition to the duo of Roku and Amazon.

The CNBC report pointed out that the firm is exploring broad partnerships in this regard with the duo of Walmart Inc (NYSE: WMT) and Chinese TV manufacturer, Hisense. Roku and Amazon maintain similar partnerships with such TV companies including Insignia and Toshiba. Through the platform, NBCUniversal’s streaming app, Peacock will be promoted to reach more audiences.

The product and service diversification may perhaps benefit the Peacock app more as it will be able to build on its subscriber list. While the app according to the WSJ has a good track of generating advert revenues, it lags behind its peers in terms of subscriptions which at the end of May was pegged at 10 million.

Comcast is worth over $254 billion per market capitalization and it primarily provides Telecommunication services. Its major competitor, AT&T Inc (NYSE: T) acquired WarnerMedia, known as Time Warner company before the deal was approved back in 2018. WarnerMedia owns CNN and the Entertainment unicorn HBO.

At present, AT&T has agreed to merge its WarnerMedia division with Discovery Inc (NASDAQ: DISCA) to solidify its grip in the content streaming and sharing ecosystem. Comcast is looking to trail this path with its latest positionings.

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