Comcast
Interview: JetBlue Airways---Neeleman, David---Chairperson of the Board
>> we’re back. today’s reading on the economic recovery shows confidence and housing figures both coming in much better than expected. let’s look at how the results are playing out in the market today. we’ll dive head first into the bloomberg terminal. what you’re looking at, the s&p retail index. 26 of 30 members up to date, ebay leading the fact percentage-wise, family dollar, limited, nordstrom’s and best buy among the best performers. let’s look at the year-to-date winner. j.c. penney following the sale of eckerd’s drug unit, toys ‘r’ us, ebay, once again, circuit city and limited rounding out the big five winners. to do a comp to give you an idea how much retail is outperforming the s&p 500 over the past 12 months, retail in white is up 50% over the same period of time the s&p 500 has been up 32%. the other big data coming out today had to do with existing home sales, that number also coming in much better than expected and not surprisingly we saw 13 of 14 members in the s&p homebuilders index on the rise today. the big winners, champion, pulte, ryland, standard pacific and m.d.c. holdings. as a group, again, an outperformer over the markets . names like champion up 63% in the first few months of this year. skyline also strong there. m.d.c. and pulte. if we look at the index, the homebuilders have been facing a lot of skepticism in the face of the probability that interest rates will go higher and some even think that will kill their business. some other than the c.e.o.’s of these companies which continue to say, some of them, that wew welcome the idea of rising rates because it reflects a a stronger economy. this is one year of the homebuilder’s index and you can see the trend we hit with the all-time high when rate speculation took a toll from the stock but more recently, cleaning it up and zooming it in because there’s an interesting technical phenomenon, this decline breaching the 20-day and 50-day moving average but recovering back again today to be in line with that green line, the 20-day moving average. so from a technical standpoint, that’s an important development, as well, on the home builders. the only thing i would point out is that the average price for homes, as well as the median, went down. comcast reporting earnings tomorrow morning, expected to say it gained driven by an increase in subscribers for high-speed data and digital cable. investors and analysts expect revenue rose almost 90% this quarter as comcast served new users. this is the figure used to measure comcast’s ability to make acquisitions and service debt because it excludes capital expenditures and other costs. reports results that meet or exceed expectations will be critical for brian roberts to convince shareholders that he doesn’t need disney to boost revenue and profit.
>> i think it would be a great acquisition for them but i don’t think it’s a deal they absolutely have to have for the future of the company.
>> investors and analysts say the uncertainty about the disney deal is weighing on the stock, shares down 12% since that deal was announced in february.
>> the market really disdains uncertainty and brian has to decide whether or not he wants to continue this because it’s really damaging his shareholders.
>> since becoming c.e.o. in 2002, he’s invested over $4 billion in rebuilding systems and offering new services such as digital video recorders and video-on-demand to help his company gain customers. roberts says the improvements will help comcast win smens 1.6 million new high-speed internet customers and over 100,000 viewers for its basic cable tv service this year. analysts say the real growth engine is the high-speed internet business which is estimated to propel comcast’s cash flow to an annual growth rate of 15% over the next three years but most agree that roberts’ first step is to make a decision about disney. some investors expect him to drop the bid altogether prior to the shareholder meeting on may 26, especially if disney posts its own strong earnings in may. comcast may also consider a share repurchase program and dividend to reassure investors it hasn’t lost interest in its cable tv business. shares of imclone jumped after the company reported its first quarterly profit in more than eight years, count them. imclone, profit on the board. here you go, big story coming up next.
