Comcast Trades at Just 8 Times Earnings After Losing 711,000 Broadband Subs Last Year

By Bryan White – Apr 20, 2026 at 3:05PM ESTKey PointsThe company's core broadband business continues to lose subscribers.Comcast is sacrificing profitability for subscriber stability with its new defensive strategy.Its growing wireless and theme park segments are helping to offset the weakness for now. Comcast (CMCSA +0.20%) generated a record $19 billion in free cash flow (FCF) in 2025 and returned nearly all of it to shareholders. Yet a significant portion of that cash comes from its declining broadband business, which lost over 700,000 domestic customers as fiber and fixed wireless competition intensified. This explains why the market is valuing the stock at just 8 times forward earnings -- a price that implies its core cash flow provider is in structural decline. The bleeding in its connectivity business, the company's largest and most profitable segment, is being driven in part by stiff competition from fixed wireless access offered by rivals like T-Mobile and Verizon (VZ 0.24%). Attrition not only continued last year but rose by 73%. More concerning, the subscriber losses accelerated as the year went on, with the fourth quarter's loss of 181,000 customers topping the third quarter's 104,000. Image source: Getty Images. A strategic pivot with some near-term pain In response to the decline, management has launched a multi-part strategy. First, it simplified the story by spinning off its legacy cable television networks in January into a stand-alone entity called Versant Media. What remains is the embattled broadband and wireless business, alongside NBC and Peacock, Universal theme parks, and a movie studio. Second, it shifted operational strategy, offering promotions such as free wireless lines and five-year price guarantees. The goal is to curb customer broadband churn and drive adoption of its wireless service. This defensive move comes at a direct cost to the segment's EBITDA margins, which are now expected to face pressure through 2026. While connectivity margins take a hit, the company's wireless segment remains a bright spot. Comcast runs this service on Verizon's network, which keeps its operating costs low. The company added 1.5 million net new wireless lines last year, bringing the total to 9.3 million. That represents around 15% of its broadband base, and management sees plenty of room to expand. Yet this growth is tied to the very base that is shrinking. Within its content and experiences segment, the theme parks delivered strong results. Adjusted EBITDA grew 24%, surpassing $1 billion in a single quarter for the first time, fueled by the opening of Epic Universe in Orlando, which generated record revenue. This provides another layer of cash flow to help plug the holes. The market's not convinced yet Comcast returned cash to shareholders in 2025 through $6.8 billion in buybacks and $4.9 billion in dividends. Still, a 4.7% dividend yield and a valuation of just 8 times forward earnings show the market's focus remains on the long-term durability of the business. The investment case centers on whether these offsets from wireless and parks, which have natural ceilings, can outrun the structural and ongoing secular decline in broadband. ExpandNASDAQ: CMCSAComcastToday's Change(0.20%) $0.06Current Price$29.69Key Data PointsMarket Cap$107BDay's Range$29.57 - $30.1452wk Range$24.12 - $34.34Volume936KAvg Vol33MGross Margin58.64%Dividend Yield4.31% The first real sign of the strategy's effectiveness will come with the second-half 2026 results, when the conversion rate of free wireless lines to paid plans is reported. A solid conversion rate would validate the margin trade-off and support long-term cash flows, while a disappointing one would signal that the pressure on profits is here to stay.Read NextApr 16, 2026 •By Matt DiLalloNetflix (NFLX) Competitors: Streaming AlternativesApr 20, 2026 •By Ryan VanzoShould You Forget NuScale Power and Buy This Nuclear Stock Instead?Apr 20, 2026 •By Lee SamahaExxonMobil Is One of 2026's Hottest Stocks.

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So Why Did the Russell 2000 Just Hit an All-Time High?About the AuthorBryan White is a contributing Stock Analyst at The Motley Fool, covering publicly traded companies across a wide range of industries and market caps. He brings more than a decade of experience as an analyst, advisor, and writer for Fool.com and several premium TMF services, including Stock Advisor, Everlasting Portfolio, Million Dollar Portfolio, and Dividend Investor Canada, where he served as lead advisor. Bryan specializes in long-term, buy-to-hold investing and enjoys making complex financial concepts approachable and engaging for individual investors. Bryan’s path to investing included entrepreneurship, which still shapes how he evaluates businesses today.TMFCaccamisiStocks MentionedComcastNASDAQ: CMCSA$29.73(+0.34%)+$0.10Verizon CommunicationsNYSE: VZ$46.44(-0.24%)-$0.11T-Mobile USNASDAQ: TMUS$198.36(+0.35%)+$0.69*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.