The separation of NBCUniversal from Comcast makes sense, says Wolfe’s Peter Supino

David Faber (Co-Anchor) 00:00.000

So, joining us now to discuss that, Peter Supino, managing director, senior analyst at Wolfe Research. Peter, nice to have you. Uh and let me start there. You know, we I've talked so much about Warner Brothers. I will continue to, of course. But what is the landscape going to

David Faber (Co-Anchor) 00:13.280

look like in 2026 for the likes of Comcast with its ownership of NBC Universal and perhaps Paramount, if it is not successful here, do they need to do something?

Peter Supino (Managing Director & Senior Analyst) 00:23.280

Well, whatever happens, it'll hinge off of their outcome of the battle for Warner Discovery. Uh and so So, the market's obsession with that battle is makes all the sense in the world. If Netflix wins it, Paramount Sky Dance faces really important strategic questions about what

Peter Supino (Managing Director & Senior Analyst) 00:41.040

to do next. The answer to those questions might involve Comcast. So, Comcast base is a similar conundrum because they won't win Warner Discovery. Either there's six companies that matter in in streaming, arguably seven. And four of them, the native streamers, Amazon, Apple,

Peter Supino (Managing Director & Senior Analyst) 00:59.560

Netflix Flix and Disney control their own destinies. The other three, Warner, Paramount, and NBC Universal, need to figure out something to do. Yeah.

David Faber (Co-Anchor) 01:09.280

I mean, Brian Roberts obviously tried. It was a It was a difficult a long shot in terms of trying to do something for Warner Brothers Discovery as I reported. But to your point, it also becomes a lot for him about his voting rights and being willing to potentially give them up.

David Faber (Co-Anchor) 01:23.640

You can imagine a Paramount Comcast combination, you'd have CBS and NBC coming together. So, not without its level of complexity. for sure.

Peter Supino (Managing Director & Senior Analyst) 01:32.400

Combining Comcast and Paramount seems almost unimaginable because Comcast stock trades for such a low multiple, just five times EBITDA and six and a half times earnings. Uh and and the cable investors and the media investors have such different strategic challenges right now.

Peter Supino (Managing Director & Senior Analyst) 01:51.280

The deal that we can imagine that makes so much sense is a separation of NBC Universal from Right. Comcast because that business could trade at more than twice the multiple of Comcast does and that could unlock about $8 per share of value for Comcast shareholders.

David Faber (Co-Anchor) 02:06.680

Yeah, no, that's what I'm talking about when I say that. I don't expect them to actually buy it. I'm saying you'd spend NBCU. But again, his voting stake becomes important. He hasn't wanted to give it up in the past, although it's unclear to me what he was willing to do in terms

David Faber (Co-Anchor) 02:18.240

of Warner Brothers, but it becomes a gating issue. For Comcast overall though, for frustrated shareholders who sat here as we have and watched the stock decline year after year at this point, you know, what are your what is your sense for 2026 and how much does it hinge on being

David Faber (Co-Anchor) 02:33.400

able to do something that creates value with NBC Universal?

Peter Supino (Managing Director & Senior Analyst) 02:36.680

Well, first, let's give Comcast high marks for the provision of editorial integrity to uh CNBC since we can have this conversation in this format. Um and our view is that the future of NBC Universal almost certainly needs to involve a separation from the Comcast cable company.

Peter Supino (Managing Director & Senior Analyst) 02:54.400

Whether that requires Brian Roberts to relinquish his voting control is unclear and his willingness to do that is extremely unclear. The the Warner Brothers Comcast or Warner's NBC promo uh proposal from a few weeks ago uh based on the filing seems to have offered uh Warner a

Peter Supino (Managing Director & Senior Analyst) 03:12.920

stake in a subsidiary that was controlled by Comcast. And so Right. Brian Roberts was not 5149. Yeah, it was 5149. That's right. That's right. And so going forward, I think it's a super interesting time to think about Comcast's next move after the outcome of Warner is clear. And

Peter Supino (Managing Director & Senior Analyst) 03:30.720

you reported 10 days ago that an activist might be accumulating shares of Comcast. We have no insight on that, but it's a really fascinating topic.