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Stock Analyst Update

Broadband Boom Good News for Comcast

Growth in digital cable and high-speed Internet was faster than expected.

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What Happened?
Comcast Corporation (CMCSK) announced Monday that pro-forma revenue, adjusted for acquisitions, grew 8.6% to $1.979 billion for the three months ended September 30, 2000. Operating cash flow grew 11.9% to $612.2 million. Growth was powered by a faster-than-expected rollout of digital cable products. During the third quarter, the company added more than 66,000 @Home customers, a 57% increase over the second quarter, and added 14,600 digital cable customers per week in the third quarter, up from 13,300 per week during the second quarter. Comcast now expects to have 375,000 @Home customers by year-end, up from the prior estimate of 350,000, and 1.35 million digital cable customers, up from the prior estimate of 1.25 million.

What It Means for Investors
We believe that the faster-than-expected adoption of digital cable and high-speed Internet access bodes well for Comcast's future and validates the company's aggressive investment in broadband services. Management's increased forecast for growth in both digital cable and high-speed Internet access further bolsters our confidence.

Richard Wilson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.