Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Comcast Corp. (NASDAQ:CMCSA)

Economic Value Added (EVA)

Advanced level

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.


Economic Profit

Comcast Corp., economic profit calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net operating profit after taxes (NOPAT)1 13,816  17,733  15,940  14,808  12,341 
Cost of capital2 8.63% 8.51% 8.13% 9.29% 9.33%
Invested capital3 224,149  217,322  216,534  162,175  155,853 
 
Economic profit4 (5,518) (755) (1,661) (252) (2,196)

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2020 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 13,8168.63% × 224,149 = -5,518

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. Comcast Corp.’s economic profit increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.

Net Operating Profit after Taxes (NOPAT)

Comcast Corp., NOPAT calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net income attributable to Comcast Corporation 10,534  13,057  11,731  22,714  8,695 
Deferred income tax expense (benefit)1 (550) 563  290  (10,655) 1,444 
Increase (decrease) in allowance for doubtful accounts2 388  67  64  38  24 
Increase (decrease) in deferred revenue3 327  554  648  420  (170)
Increase (decrease) in equity equivalents4 165  1,184  1,002  (10,197) 1,298 
Interest expense 4,588  4,567  3,542  3,086  2,942 
Interest expense, operating lease liability5 160  172  165  135  143 
Adjusted interest expense 4,748  4,739  3,707  3,221  3,085 
Tax benefit of interest expense6 (997) (995) (779) (1,127) (1,080)
Adjusted interest expense, after taxes7 3,751  3,744  2,929  2,093  2,006 
(Gain) loss on marketable securities (1,014) (656) 187  17  (12)
Investment income, before taxes (1,014) (656) 187  17  (12)
Tax expense (benefit) of investment income8 213  138  (39) (6)
Investment income, after taxes9 (801) (518) 148  11  (8)
Net income (loss) attributable to noncontrolling interest 167  266  131  186  350 
Net operating profit after taxes (NOPAT) 13,816  17,733  15,940  14,808  12,341 

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in allowance for doubtful accounts.

3 Addition of increase (decrease) in deferred revenue.

4 Addition of increase (decrease) in equity equivalents to net income attributable to Comcast Corporation.

5 2020 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 4,458 × 3.58% = 160

6 2020 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 4,748 × 21.00% = 997

7 Addition of after taxes interest expense to net income attributable to Comcast Corporation.

8 2020 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 1,014 × 21.00% = 213

9 Elimination of after taxes investment income.

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. Comcast Corp.’s NOPAT increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.

Cash Operating Taxes

Comcast Corp., cash operating taxes calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Income tax expense (benefit) 3,364  3,673  3,380  (7,578) 5,308 
Less: Deferred income tax expense (benefit) (550) 563  290  (10,655) 1,444 
Add: Tax savings from interest expense 997  995  779  1,127  1,080 
Less: Tax imposed on investment income 213  138  (39) (6)
Cash operating taxes 4,698  3,967  3,908  4,210  4,940 

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. Comcast Corp.’s cash operating taxes increased from 2018 to 2019 and from 2019 to 2020.

Invested Capital

Comcast Corp., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Current portion of long-term debt 3,146  4,452  4,398  5,134  5,480 
Long-term debt, less current portion 100,614  97,765  107,345  59,422  55,566 
Operating lease liability1 4,458  4,606  4,384  3,335  3,189 
Total reported debt & leases 108,218  106,823  116,127  67,891  64,235 
Total Comcast Corporation shareholders’ equity 90,323  82,726  71,613  68,606  53,943 
Net deferred tax (assets) liabilities2 27,832  28,093  26,369  24,202  34,813 
Allowance for doubtful accounts3 807  419  352  288  250 
Deferred revenue4 3,713  3,386  2,832  1,552  1,132 
Equity equivalents5 32,352  31,898  29,553  26,042  36,195 
Accumulated other comprehensive (income) loss, net of tax6 (1,884) (1,047) 368  (379) (98)
Redeemable noncontrolling interests and redeemable subsidiary preferred stock 1,280  1,372  1,316  1,357  1,446 
Noncontrolling interests 1,415  1,148  889  843  2,231 
Adjusted total Comcast Corporation shareholders’ equity 123,486  116,097  103,739  96,469  93,717 
Construction in process7 (7,095) (5,245) (2,991) (1,752) (1,901)
Marketable equity securities8 (460) (353) (341) (433) (198)
Invested capital 224,149  217,322  216,534  162,175  155,853 

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of deferred revenue.

5 Addition of equity equivalents to total Comcast Corporation shareholders’ equity.

6 Removal of accumulated other comprehensive income.

7 Subtraction of construction in process.

8 Subtraction of marketable equity securities.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. Comcast Corp.’s invested capital increased from 2018 to 2019 and from 2019 to 2020.

Cost of Capital

Comcast Corp., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 235,675  235,675  ÷ 365,733  = 0.64 0.64 × 11.82% = 7.61%
Debt3 125,600  125,600  ÷ 365,733  = 0.34 0.34 × 3.60% × (1 – 21.00%) = 0.98%
Operating lease liability4 4,458  4,458  ÷ 365,733  = 0.01 0.01 × 3.58% × (1 – 21.00%) = 0.03%
Total: 365,733  1.00 8.63%

Based on: 10-K (filing date: 2021-02-04).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 200,971  200,971  ÷ 321,377  = 0.63 0.63 × 11.82% = 7.39%
Debt3 115,800  115,800  ÷ 321,377  = 0.36 0.36 × 3.78% × (1 – 21.00%) = 1.08%
Operating lease liability4 4,606  4,606  ÷ 321,377  = 0.01 0.01 × 3.74% × (1 – 21.00%) = 0.04%
Total: 321,377  1.00 8.51%

Based on: 10-K (filing date: 2020-01-30).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 165,514  165,514  ÷ 283,998  = 0.58 0.58 × 11.82% = 6.89%
Debt3 114,100  114,100  ÷ 283,998  = 0.40 0.40 × 3.77% × (1 – 21.00%) = 1.20%
Operating lease liability4 4,384  4,384  ÷ 283,998  = 0.02 0.02 × 3.77% × (1 – 21.00%) = 0.05%
Total: 283,998  1.00 8.13%

Based on: 10-K (filing date: 2019-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 197,531  197,531  ÷ 272,566  = 0.72 0.72 × 11.82% = 8.56%
Debt3 71,700  71,700  ÷ 272,566  = 0.26 0.26 × 4.04% × (1 – 35.00%) = 0.69%
Operating lease liability4 3,335  3,335  ÷ 272,566  = 0.01 0.01 × 4.04% × (1 – 35.00%) = 0.03%
Total: 272,566  1.00 9.29%

Based on: 10-K (filing date: 2018-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 178,803  178,803  ÷ 248,292  = 0.72 0.72 × 11.82% = 8.51%
Debt3 66,300  66,300  ÷ 248,292  = 0.27 0.27 × 4.50% × (1 – 35.00%) = 0.78%
Operating lease liability4 3,189  3,189  ÷ 248,292  = 0.01 0.01 × 4.50% × (1 – 35.00%) = 0.04%
Total: 248,292  1.00 9.33%

Based on: 10-K (filing date: 2017-02-03).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

Comcast Corp., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Economic profit1 (5,518) (755) (1,661) (252) (2,196)
Invested capital2 224,149  217,322  216,534  162,175  155,853 
Performance Ratio
Economic spread ratio3 -2.46% -0.35% -0.77% -0.16% -1.41%
Benchmarks
Economic Spread Ratio, Competitors4
Charter Communications Inc. -2.79% -4.46% -4.73% -5.83% -6.28%
Netflix Inc. 2.88% 0.93% 0.07% -3.21% -4.17%
Walt Disney Co. -12.60% -1.90% 3.40% 1.39% 3.54%

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

1 Economic profit. See details »

2 Invested capital. See details »

3 2020 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -5,518 ÷ 224,149 = -2.46%

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. Comcast Corp.’s economic spread ratio improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Economic Profit Margin

Comcast Corp., economic profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Economic profit1 (5,518) (755) (1,661) (252) (2,196)
 
Revenue 103,564  108,942  94,507  84,526  80,403 
Add: Increase (decrease) in deferred revenue 327  554  648  420  (170)
Adjusted revenue 103,891  109,496  95,155  84,946  80,233 
Performance Ratio
Economic profit margin2 -5.31% -0.69% -1.75% -0.30% -2.74%
Benchmarks
Economic Profit Margin, Competitors3
Charter Communications Inc. -7.71% -13.39% -14.76% -19.17% -30.10%
Netflix Inc. 3.41% 1.11% 0.08% -2.93% -3.00%
Walt Disney Co. -33.81% -4.55% 4.54% 2.00% 4.74%

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-01-30), 10-K (filing date: 2019-01-31), 10-K (filing date: 2018-01-31), 10-K (filing date: 2017-02-03).

1 Economic profit. See details »

2 2020 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × -5,518 ÷ 103,891 = -5.31%

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company’s profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. Comcast Corp.’s economic profit margin improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.