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Activist Trian takes stake in Comcast: rpt

Yahoo Finance's Dan Robert's joins the On the Move panel to discuss the report that Activist Trian Fund Management is taking stake in Comcast.

Video Transcript

JULIE HYMAN: We're also watching shares of Comcast today. They're up a little more than 3%, and that's after the "Wall Street Journal" reported that Trian, Nelson Peltz's fund, had accumulated 20 million shares of Comcast. It's about a $900 million stake or about 0.4% of the company. Of course, Peltz has a history of being an activist shareholder.

Dan Roberts, I guess the question is here, what changes-- I mean, it's all theoretical at this point, but what changes could he push for at Comcast?

DAN ROBERTS: Yeah, that's the big question, Julie. And it's worth mentioning, as you said, although Comcast shares are up 3% on this news, the stock was doing well already this year, or at least as well as could be expected among the big TV names.

And, as you also mentioned, I mean, our viewers know Trian. This is Nelson Peltz's fund. It's an activist fund. Previously had gotten involved in Procter & Gamble most notably, I think also GE.

So what might they do? Well, they're going to try and enact change and try and send the stock higher and try and maybe shake things up at the company. But it's worth noting, the share that Trian has taken is very small. I mean, we've heard of much bigger stakes by activist hedge funds. It's less than half of 1%. What can they really do, especially when so much of-- Brian Roberts and his family are the shareholders there, and so much of the company or so much of the shares are still owned by them.

So what could be changed? Well, we know that Comcast has NBCUniversal. NBC Peacock launched in the last six months or so, you know, and there's a mixed bag there. It has certainly done better than Quibi has done. But, you know, trying to get into the streaming and also Sky, part of the Comcast folder now, I guess the portfolio. There's also the Comcast Xfinity brand, which is an over-the-top play. So, you know, Nelson Peltz and the other people at Trian might feel that Comcast could be doing better or could maybe streamline its offerings.

I mean, if you look at the whole streaming wars right now, it's debatable who's doing the best there. And it's not certain that Peacock is really necessarily the best play, right? I mean, there are so many new entrants right now. Peacock launched at the same time as HBO Now or Go or Max, whatever they're now calling the HBO product, because they've had to rebrand that so many times. There's Netflix. Hulu is doing better than ever with the entire FX library. That's majority owned by Disney. You've got Disney+.

It's so busy and crowded that you could expect that maybe Trian wants to push for a board seat or more board seats and try and enact change. Maybe it ends up involving Comcast selling something off. Maybe it's the opposite-- Comcast making a big purchase. But it remains to be seen what they want to do.

ADAM SHAPIRO: Hey, Dan, in the "Wall Street Journal" article about this, they pointed out that Comcast's broadband business is growing at a fast clip. What I think a lot of people are trying to figure out with Peltz is, where's the value? Because let's assume he doesn't push for a change. There's got to be a payoff for him on this.

DAN ROBERTS: Well, I would assume that they are going to push for some kind of change, right? I mean, why take that size of a stake, almost a billion dollars, even though it is relatively small.

But, yeah, you mentioned the broadband business. That's Xfinity. But everything is just going to get more and more cutthroat in this space. I mean, we talk so much about share of wallet, right? And so where is there fat that can be cut? That's question one, when you talk about a network like this.

Remember, NBC is now waiting an extra year for the Olympics, right? I mean, that was a big loss. And, of course, you could say that's no one's fault. That's the pandemic. But there was TV advertising revenue there that was going to come in this year that now didn't come in this year.

So probably either they're looking at certain areas financially at the company and wondering, well, where could we cut? So I would expect change, but, yeah, your guess is as good as mine. I mean, what would they do differently, or what would they maybe sell off? Sky might end up a key part of it.