Comcast solvent, but its "hard pressed customers" aren't: analyst

Comcast Corp. has less debt, given its size, than other big telecom companies, but it will still suffer, in this recession, from lower advertising sales, higher financing costs, and "serious ill will" from "hard pressed customers" whose "bills have simply gotten very high," writes Craig Moffett, senior telecommunications companies analyst at Sanford C. Bernstein & Co. LLC in New York. He estimates the average Comcast subscriber already pays $111 per month, making it hard for the company to raise rates without driving some users away.

  Comcast "carries a stronger balance sheet by most credit measures than its competitor Verizon," and "Comcast is likely to feel the impacts of a tight credit market the least" among its competitors, Moffett writes. By contrast, small, highly-leveraged cable operators "may not make it," and some could get sold.

   Moffett and his team cut their Comcast stock target to $24 from $30 -- partly an acknowledgement the market has tanked, driving Comcast shares below $16 for the first time since 2002 in recent days. They also cut Time Warner Cable and Cablevision, while noting that all three cable giants now trade at bargain prices, compared to other telecom companies: Comcast has lately fetched just 5x estimated 2009 earnings (before interest, tax, depreciation, amortization). Despite cutting the target prices, Moffett rates all three stocks "Outperform," expecting they'll recover with the market.