The amazing part about the current rally is that the slow growing industries such as utilities and cable companies have led the rally. For the most part though, the rally hasn't been based on any fundamental changes in those industries. Most notably the move has been based on an investor chase for yield. Stocks paying 4% dividend yields are attracting investors getting next to nothing in 10-year Treasuries.
So why has Comcast Corp. (CMCSA) followed in that rally? The current yield of 1.8% shouldn't be enough to attract investors with the stock trading at nearly 17x next year's earnings. In comparison, Time Warner Cable (TWC) pays 2.3%, while communications providers AT&T (T), Verizon Communications (VZ), and Vodafone (VOD) pay over 4%.
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