Comcast Corporation (CMCSA): How About Investing in a “Fast & Furious” Company?

“Fast and Furious 6,” from Comcast Corporation (NASDAQ:CMCSA)‘s  Universal Pictures, led the box office for the weekend of May 31 – June 2, grossing $35.2 million according to numbers released by Hollywood.com.

Source: Hollywood.com

Comcast, as a global media and technology giant, continues to benefit from the strong sales generated from its filmed entertainment segment. “Fast and Furious 6” had generated over $173.9 million and $310.2 million overseas for Universal Pictures.

Movies are going strong for Universal

With the completion of acquisition of NBC Universal from General Electric Company (NYSE:GE) in the previous quarter, Comcast Corporation (NASDAQ:CMCSA) had a solid Q1 with strong growth. NBC Universal businesses generated 17% growth in operating cash flow. The first-quarter revenue growth (2%) was driven by the strong box office performance of “Les Miserables” and the successful release of “Identity Thief” and “Mama” in the quarter.

As of June 3, “Identity Thief” had brought in nearly $173.9 million globally ($134.5 million domestically) with a production budget of $35 million for Universal, whereas “Mama” had recorded $144.8 million worldwide ($71.6 domestically) with a production budget of $15 million. Film operating cash flow increased to $69 million from $63 million due to strong box office and lower marketing costs.

Financially sound

Overall, Comcast’s free cash flow remains solid and continues to grow, reaching record $3.1 billion with 3.3% growth for Q1, reflecting growth in consolidated operating cash flow, partially offset by higher CapEx. Comcast Corporation (NASDAQ:CMCSA) continues to strengthen its balance sheet with a medium-term leverage target of 1.5 to 2x. With these improvements, Comcast’s public debt ratings were upgraded by two major credit rating agencies recently. On the other hand, Comcast also rewarded shareholders handsomely with dividend payments of $429 million and share repurchase of $500 million in Q1.

Competition

“Now You See Me,” from Lions Gate Entertainment Corp. (USA) (NYSE:LGF), ranked behind “Fast and Furious 6” and grossed $29.2 million in revenue during the weekend, totaling $32.3 million domestically as of June 3, 2013. Amazingly, with its solid gain in 2012, Lions Gate continues to outperform the market with a whopping 84.53% gain YTD. Lions Gate continues to deliver strong revenue and has delivered three positive earnings surprises in the last three quarters.

With the success of “The Hunger Games” and controlling of the “Twilight” series through the acquisition of Summit Entertainment, Lions Gate continues to expand its share in Hollywood. Along with its popular show of “Mad Men” and the extension of its contract with current CEO Jon Feltheimer, who has been with the company for 13 years, Lions Gate is expected to grow its earnings continuously in the coming years.