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For growth, utility expert Roger Conrad likes Comcast Corp. (NASDAQ: CMCSA), while for income, he picks the cable firm's dividend-paying notes and preferreds.
The editor of The Utility Forecaster explains, "Cash flow and revenue growth of 30%-plus is hardly utility like. But those are the numbers cable communications provider Comcast Corp. put up in the second quarter and has consistently for the past few years."
Best of all, he adds, there's no end in sight to its success. He observes, "The company added 94% more revenue-generating units in the second period than last year, a clear sign sales of its 'triple bundle' of cable TV, broadband Internet and telecom service are still accelerating."
Conrad continues, "The company has increased its pool of basic customers to upsell with several acquisitions in recent years, dwarfing the small losses to rival providers that some Street analysts remain fixated on. Operating cash flow margin rose to 41.3% from 40.9%, compelling evidence the most profitable parts of its business are still expanding."
Down nearly 20% from recent highs, he believes the common stock is a strong buy for long-term growth up to 30. Income investors, however, will be more interested in its bonds and preferred stocks, he notes, which continue to benefit from debt reduction.
Conrad explains, "We've chosen the Comcast 5.85 Percent Notes of 01/15/10 as our latest Spotlight Income feature. The notes have little interest rate or credit risk and pay a yield to maturity of 5.4%.
"Slightly more exposed to rate swings are the Comcast 7 Percent Preferreds (NYSE: CCT), which yield 7.4% paid quarterly. Buy the notes up to 102 ($1,020) and the preferred up to 25."
Each day, Steven Halpern's TheStockAdvisors.com features the latest stock picks and investment ideas from the nation's leading financial newsletter advisors.
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