February 1, 2021
While Disney maintains operational and majority control of Hulu, Comcast quietly owns 33% in the subscription streaming video service, with the right to cash out in 2024.
But that scenario isn’t sitting well with veteran analyst Richard Greenfield with Lightshed Partners. Greenfield contends Comcast should cash out now due to the ongoing global move toward over-the-top video distribution — underscored by Comcast’s own streaming ventures Peacock and broadband-based Flex.
Disney continues to focus its resources on Disney+, including expanding international distribution, most-notably in India under the Hotstar brand — the latter responsible for 33% of the 86.8 million Disney+ subscribers. Hulu touted 38.8 million subs at the beginning of last December.
Greenfield values Hulu currently around $45 billion, which would translate to $15 billion for Comcast’s stake. The media giant’s existing deal calls for a floor-based minimum value of $27.5 billion for Hulu, or $9 billion for Comcast.
“The Hulu joint venture appears to have outlived its usefulness, with Comcast and Disney both increasingly focused on their own direct-to-consumer platforms,” Greenfield co-wrote in a Jan. 28 post. “Waiting until 2024 to resolve ownership would appear to create an unwanted/unnecessary financial overhang on Disney given how fast the valuation of streaming assets are growing.”
Maybe, but neither company appears to be in a hurry to move on Hulu. Wedbush Securities media analyst Michael Pachter suggests Disney may eventually fold Hulu into Disney+ as a subset content offering as it has with FX.
Comcast CEO Brian Roberts made no mention of Hulu on the Jan. 28 fiscal call. When last discussed publicly in April 2019, Roberts said Hulu remained a key asset.
“On Hulu, the relationship with NBC, it’s very much in everybody’s interest to maintain,” Roberts said at the time. “And we have no new news on it, other than it’s really valuable. And we’re really glad we own a large piece of it.”