9AM Hour: Comcast Soars on Split Decision, Stocks Rebound, SpaceX to Join Nasdaq 100 6/29/26

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David Faber (0:54)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:59)

Good Monday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Sara Eisen, David Faber at Post 9 of the New York Stock Exchange. Cramer has the morning off. Holiday shortened week as we start to wrap up the first half of the year. Pre-market has the bulls trying to get a little back from a tough June, and a near 5% drop in the NDX last week. Oil's back to 70 The US strikes are on over the weekend, and the number of tankers crossing the strait daily drops back to 22 A roadmap begins with signs of a tech bounce back ahead of the open.

The longest losing streak since last August.

David Faber (1:33)

Comcast here is seeing something they don't typically see. That is a rally. The media company announcing its plan to separate its media and cable businesses into two publicly traded companies.

Sara Eisen (1:45)

And SpaceX to join the Nasdaq 100 next week. The exchange confirming plans to accelerate the timeline for the Elon Musk-led company.

David Faber (1:54)

All right, let's start with that Comcast news this morning. We are the former parent of course of CNBC, although now we are a part of Versant, which was the first spinoff from Comcast and from NBCUniversal. But this is a deal that perhaps had been discussed for some time, thought about as a real possibility, and has come to fruition in part because of the performance of Comcast stock. The company announcing plans to split into two independent publicly traded companies. It will be a tax-free spin. They will spinoff NBCUniversal, also include the Sky unit in the NBC spin. Of course, which also will include theme parks, and Peacock, and the Bravo Network, not to mention NBC itself, and the O&Os.

Could have been any point along the way, including when the Versant spin was announced, that many said, well, why not just split the entire company? But what I'm hearing from people close to this situation is essentially the following. I've discussed a bit on a call that ended shortly ago of Brian Roberts and Mike Kavanaugh, who run Comcast and NBCUniversal respectively. Very difficult to do much of anything when your stock is trading at four and a half times EBITDA has been the case with Comcast. The company's stock price has been under pressure, of course, as our viewers well know, from the competitive pressure from the likes of Starlink, a la SpaceX, AT&T, Verizon, the fiber overbuild, fixed wireless, and what that has meant in terms of the competitive landscape for offering broadband. And so, you've seen an enormous loss of value at Comcast over a long period of time here. It's funny because the argument not that many years ago had been, well, if you were to split the company, you actually would get a higher multiple at what was left at Comcast as opposed to spinning or spinning off the lower multiple assets. That's completely reversed. Now the idea is, well, actually, you give both of these companies their own balance sheets, their own managements, their own capital structure, their own stocks, and you allow them to create their own independent futures. And by the way, NBCU will trade, most likely, at a higher multiple as it is freed to a certain extent.

Sara, there's, and Carl, there's no shortage of those who will say, well, this is about actual future consolidation. And that may well be the case, but as people who are listening to the call learned, as from Brian Roberts certainly, and as I have at least been hearing from people familiar with the situation, that is not the reason for doing this at this point. It may be that Comcast itself does combine with another company, perhaps Charter down the road, maybe a wireless company. It's certainly conceivable that the NBC assets would be of interest to, let's go through it, Netflix. We can always say Apple, who knows, Amazon, YouTube. But again, what I'm hearing right now is, you know, gotta, I mean, this is my own words, gotta do something because this is an untenable situation. And in part, even the fight for Warner Brothers Discovery kind of made that very clear. In many ways, what I heard as the process moved along is reporting from some time back. But, you know, NBCU had a very valuable offer, but not one that was really actionable, in part because of the structure itself.