Dinosaurs Roar for Comcast and CoreWeave Goes Shopping

Summary

Motley Fool Money Episode Summary: "Dinosaurs Roar for Comcast and CoreWeave Goes Shopping"

Release Date: July 7, 2025
Hosts: Andy Cross and Jason Moser
Podcast: Motley Fool Money

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1. Comcast’s Box Office Triumph with Jurassic World Rebirth

The episode kicks off with a discussion on Comcast’s recent success at the global box office, attributed to the release of Universal’s "Jurassic World Rebirth." Andy Cross highlights the impressive revenue figures, noting that the film grossed over $300 million worldwide within its opening weekend, contributing positively to Comcast's financials.

Key Points:

• Revenue Impact: Comcast’s Content and Experiences studio segment reported $11 billion in revenue for 2024, with an operating profit of approximately $1.4 billion. While not a game-changer year-over-year, the success of the "Jurassic World Rebirth" adds significant value to Comcast’s content portfolio.

• Franchise Expansion: The longevity of the Jurassic franchise, which dates back to the original 1993 film, showcases Comcast’s strategic expansion of its intellectual property (IP) library. This move mirrors Disney’s strategy with its own franchises, enhancing the value and competitiveness of Comcast's offerings.

• Market Positioning: Andy Cross emphasizes the strategic advantage of leveraging long-standing franchises to maintain a competitive edge in the content space, which can be volatile and "lumpy." The recent performance counters the cyclical nature of revenue fluctuations in content-driven segments.

Notable Quote:

"This is terrific news... the original Jurassic park came out back in 1993." – Andy Cross ([02:03])

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2. CoreWeave’s Strategic Acquisition of Core Scientific

A significant portion of the discussion centers on CoreWeave’s announcement to acquire Core Scientific for approximately $9 billion in an all-stock deal. This move signifies CoreWeave’s commitment to scaling its AI infrastructure capabilities.

Key Points:

• Acquisition Details: CoreWeave is set to purchase Core Scientific at an estimated $20 per share, though Core Scientific’s stock had fallen by about 20% to $15 at the time of the announcement, indicating market skepticism.

• Strategic Benefits: The acquisition will provide CoreWeave with about 1.3 gigawatts of gross power capacity, plus an additional gigawatt available for expansion. This vertical integration strengthens CoreWeave’s position as an AI hyperscaler by significantly expanding its data center capacity.

• Market Reception: Andy Cross speculates that while the deal is poised to proceed, the final valuation may adjust due to the aggressive initial price. Jason Moser echoes this sentiment, suggesting potential readjustments to the deal terms to align more closely with market valuations.

Notable Quotes:

"It's a power play. Through this acquisition, Core Weave is going to own approximately 1.3 gigawatts of gross power..." – Andy Cross ([08:18])

"I think the market is just saying with the share issuance so soon after Core, we became public, there are some doubts..." – Andy Cross ([08:32])

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3. Oracle’s Cloud Service Price Cuts for the US Government

The conversation shifts to Oracle’s strategic decision to reduce cloud service prices for the US government by up to 75%, as reported by the Wall Street Journal.

Key Points:

• Dual Benefits: Andy Cross interprets the price cuts as beneficial for both Oracle and the US federal government. The reduced costs align with government mandates to modernize IT infrastructure while adhering to tighter budget constraints.

• Competitive Landscape: This move mirrors similar strategies by other cloud providers like Salesforce, Google, and Adobe, indicating a broader industry trend towards aggressive pricing to secure long-term governmental contracts.

• Valuation and Growth: Jason Moser points out Oracle’s substantial market valuation, noting its stock has surged over the past year and is trading at 35 times earnings, nearly double its five-year average. Despite the rich valuation, Andy Cross underscores Oracle’s ambitious growth targets, especially in cloud revenue and infrastructure as a service (IaaS), projecting significant expansion by 2026.

Notable Quotes:

"I think that’s got a lot of investors interested in Comcast at least for me, those of us who own it." – Jason Moser ([02:13])

"They have to deliver." – Andy Cross ([14:18])

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4. Stock Watch List: Samsara (IOT) and Hammet (HWM)

In the final segment, Andy Cross and Jason Moser share their top stock picks to watch, focusing on Samsara and Hammet.

a. Samsara (Ticker: IOT)

• Company Overview: Samsara operates a connected operations cloud, integrating various devices within a company's infrastructure to generate actionable data. The platform connects equipment across buildings, vehicles, and facilities, creating a comprehensive data network for businesses.

• Financial Performance: Despite being cash flow positive, Samsara continues to invest heavily in growth, with significant stock-based compensation impacting profitability. The company is valued at approximately 14 times forward sales projections.

• Growth Metrics: Recent first-quarter results exceeded expectations, with a 32% increase in revenue and a 31% rise in annualized recurring revenue (ARR). The customer base has grown to 2,638 customers with ARR exceeding $100,000, marking a 35% year-over-year increase.

• Investment Rationale: Samsara’s leadership, driven by co-founders owning significant voting power, exhibits a strong commitment to long-term growth and innovation. Andy Cross highlights Samsara’s dominant market position and growth potential as key reasons to consider it for investment, especially during market pullbacks.

Notable Quotes:

"It is a company that continues to grow and establish a fairly dominant position in its market." – Andy Cross ([16:55])

"It really does seem like this is becoming kind of the top dog at its space." – Andy Cross ([16:55])

b. Hammet (Ticker: HWM)

• Company Overview: Hammet, formerly part of Alcoa, specializes in high-precision metalworking, supplying 90% of all structural and rotating aero engine components for the aerospace, transportation, and energy markets. The company produces high-end precision airfoils, forged wheels, and chassis for commercial trucking and automotive sectors.

• Performance: Hammet’s stock has doubled over the past year and surged nearly 50% since being recommended by the Motley Fool’s Stock Advisor team. The firm boasts robust competitive advantages, including patented technologies and a strong client base.

• Opportunities: The energy sector presents significant growth opportunities for Hammet, particularly in supplying blades for engine turbines that power data centers.

• Investment Considerations: While Hammet’s current valuation is steep, Andy Cross expresses confidence in its long-term potential, suggesting that a market correction could provide an attractive entry point for investors.

Notable Quotes:

"It's a nice business, it just has to go though the rule breakers team over in Stock Advisor." – Jason Moser ([17:30])

"I just want to see, I'm not going to criticize anybody for adding this great business to his portfolio." – Andy Cross ([18:00])

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Conclusion

Andy Cross and Jason Moser wrap up the episode by reiterating their positive outlook on the discussed companies despite market volatilities. They emphasize the importance of strategic acquisitions, competitive pricing, and robust growth metrics in driving long-term investment success. Listeners are encouraged to consider Samsara and Hammet as potential additions to their portfolios, especially during market downturns.

Final Remarks:

"Patience tends to pay off 100%." – Andy Cross ([19:01])

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Disclaimer: The hosts remind listeners that the Motley Fool may hold positions in the stocks discussed and recommend conducting personal due diligence before making investment decisions.

Transcript

[Andy Cross]

Foreign.

[Jason Moser]

Dinosaurs roar for Comcast, while Core Weave makes an acquisition. Motley Fool Money starts now. Welcome to Motley Fool Money. I'm Andy Cross, joined by Motley fool senior analyst and advisor Jason Moser. Jason, happy Monday.

[Andy Cross]

Happy Monday, A.C. good to see you.

[Jason Moser]

Good to see you. Thanks for being here. We got confirmation today that Core Weave is buying another AI data center company and Oracle is cutting cloud prices for Uncle Sam. We'll also talk about two companies we're keeping an eye on if the price is right. But Jason, let's start with the summer movies. Universal's Jurassic World rebirth reportedly brought in more than 300 million globally this weekend, giving a nice win to Comcast, the parent owner of Universal. This continues that strong summer at the box office that included how to Train youn Dragon, also from universal and Apple's F1. Jason, is this good news for long suffering Comcast shareholders like me?

[Andy Cross]

It's not bad news. That's, that's most certainly it's not bad news. Now, Comcast Content and Experiences studio segment brought in $11 billion in revenue in 2024, along with about $1.4 billion in operating profit. So, I mean, this isn't something from the revenue side that is a tremendous needle mover. But you know, I think about when maybe it's a needle mover to the extent that we would say the same thing for Disney. Right. I mean, this is, this is the content space. It can be very lumpy. Some years are better than others. I mean, if you look at the same segment, right, the Content and Experiences studio segment, we talked about $1.11 billion in revenue in 2024. I mean, that was $12.3 billion in 2022. So it ebbs and flows. But this is terrific news. And I think the thing that kind of, I'm kind of amazed at, you know, the original Jurassic park came out back in 1993.

[Jason Moser]

Yeah.

[Andy Cross]

So they have pulled a Disney to an extent and have really expanded and stretched out this IP library. I think that is a good sign for a comcast, Jason. I.

[Jason Moser]

100%. So I see this as, again, this Comcast stock has not done that well over the past couple years. It now yields about 3.7%. And of course, we have the spin off, the spin out of the media properties called Versant. Yeah, Versant, Versant later this year where they're going to spin off CNBC and usa, msnbc, the Golf Channel and a few other properties. So I think that's got a lot of investors interested in Comcast at least for Me, those of us who own it. But this is the seventh film franchise of the Jurassic franchise, and that franchise is worth about $6 billion. And it is a Disney plague, kind of. Jason, because they're using that in their iPad. They're using the theme parks. I saw promotions all around the world, all around the, the cable properties for, for the Jurassic Rebirth movie. They were sold. They were showing older Jurassic movies on some of those cable properties this weekend. So I think from that perspective, it does help build that franchise out and it's going to be a very competitive summer. Disney itself has this fantastic Four coming out this summer. We have the much anticipated Superman movie from Warner Brothers coming out this, this year. But I think it does help build out that FR that has become more and more valuable to those Universal theme parks, including the one they just opened up this year.

[Andy Cross]

No question. And I mean, this also plays into sort of that summer blockbuster. Right? We always love to see what the summer blockbusters are going to be. And I just think it's noteworthy, these results, particularly given there's sort of tepid reviews that the movie's gotten. Right. I haven't seen it and I kind of take critics criticisms with a grain of salt. But I mean, 51% on rotten tomatoes and a cinema score of B from the opening weekend audience, I mean, that's not lighting the world on fire from a critic's perspective, but clearly the audience loved it.

[Jason Moser]

Yeah. And also Jason, interesting notes over the weekend that Netflix, with its 300 million subscribers, they said at the Anime Expo in Los Angeles this weekend that more than half its subscribers now watch Japanese anime. I found that interesting just because it continues to show the power of the Netflix globally as a brand. And one reason why they're along with YouTube, one of the most valuable media properties out there.

[Andy Cross]

And we've always said they do such a good job with that data. I mean, this, this. Personally, I'm not an anime consumer, but I think this is a great example for investors where it's not necessarily wise to extrapolate one personal tastes into a potential idea. Just because it's not something that you like or eat or watch, it doesn't mean there isn't an opportunity there. And that 50% number globally really does tell us something impressive about Netflix market position.

[Jason Moser]

100%. When Motley fool money returns. Core Weave go shopping.

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[Jason Moser]

AI infrastructure company CoreWeave announced that it will buy Core Scientific for around $9 billion in an all stock deal. That's about $20 per share based on Core Weave stock. Now shares of Core Scientific, Jason, are down around 20% today to about 15. So the market's sensing something here.

[Andy Cross]

Yeah, this is an arms race. Like we haven't seen time. I mean companies are just rushing to build out their AI capabilities and this is just another sign of that. But I think it's really noteworthy the Core Scientific shares being down so much today. I mean, there can be a number of reasons why something like that might happen. Investors don't think the deal will go through. Perhaps another bidder comes in. But AC I wonder if this doesn't have something to do with the deal structure itself and what it's saying about the market's perspective on Core Weave. Because you, that 9 billion number that's being bandied about. Let's, let's make sure we understand that's just based on the July 3rd share price. Right. Core Scientific shareholders are going to receive 0.1235 shares of Core Weave for, for each share of Core Scientific that they hold. But as noted in the release, and this is important, the final value will be determined at the time of the transaction close. That's not until later in Q4, so I don't know. Do you think this is like a glass half empty view on Core Weave and whether they can sort of hold their valuation because the stock has been on fire since it went public.

[Jason Moser]

Yeah, it went public just this year and the stock's done just fantastically well. And Core Scientific has done very well, although it has a little kind of spotted history. It's one of those SPACs back in 2021 that when it came public out there was about, about $4 billion and it basically lost almost 100% of its value. Had to declare bankruptcy defile from the, from the markets, came back to the public markets in January 2024 and actually core Weave tried to buy them last year for about $6 per share. So now they're, you know, paying far more for that. It does give Core Weave that vertical integration, Jason, that I think they're neat, that they need to build out. They're going to add about nine or ten AI data centers of Core Scientifics, give them massive gig gigawatts of capacity. And, and as Core Weave is trying to build out its own AI data centers, it does need to continue to build out that capacity. And Core Scientific. Core Weave is Core Scientific's largest tenant.

[Andy Cross]

Yeah.

[Jason Moser]

So it makes sense from a vertical integration perspective, but I think the market is just saying with the share issuance so soon after Core, we became public, there are some doubts about whether at what price they're going to have to get Core Scientific into the Core Weave family.

[Andy Cross]

Exactly. And I mean, I certainly understand the market's enthusiasm around Core Weave. Right. I mean, when you selling yourself as the AI hyperscaler and I mean, there is something to that. And this is clearly a company that's playing a big role in the space. They just reported revenue growth 420% in this most recently reported quarter. But again, and you're right, Vertical integration, this is going to be something that really gives Core Weave more power over its platform. And to that power, I mean, this is a power play. Right. Through this acquisition, Core Weave is going to own approximately 1.3 gigawatts of gross power, along with the opportunity of 1 plus gigawatts of potential gross power available for expansion. I mean, a gigawatt is a lot of power. Yeah, it's like that power is a medium sized city. And you think about the Hoover Dam. The Hoover Dam, like one of our biggest hydroelectric generators here in the country. And that's responsible about 2 gigawatts of capacity. So you can see how this could really impact Core Weave if it goes through prediction time.

[Jason Moser]

Yeah. Do you think it's going to go through? Do they have to lower the price? Readjust the deal terms, you think?

[Andy Cross]

Yeah, I think it's going to go through. I think that probably the market's enthusiasm is going to remain for Core. We think the stock will ebb and FL here a little bit. My suspicion is it'll go through. Probably not going to end up at that $9 billion valuation at the end of the day because that is pretty extreme for a company like Core Scientific. I mean, that's like 18 times full year revenue in 2024. Yeah. So yeah, we might see some change in the price there, but my suspicion is it'll go through.

[Jason Moser]

There's definitely some, some synergies there and some cost savings, but I think it'll go through too. But I do think they'll have to readjust the term.

[Andy Cross]

Exactly.

[Jason Moser]

Next up on Motley Fool Money Oracle gives Uncle Sam.

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[Jason Moser]

Medill. Let's move over to news that Oracle is cutting cloud service prices for the US government by as much as 75% as reported reported this weekend by the Wall Street Journal. Jason, who's a winner here? Is this an Oracle beneficiary? A US Federal government beneficiary? A little bit of A, a little.

[Andy Cross]

Bit of B. I'm going to walk the fence here and say a little bit of a, a little bit of B. It does feel like both win somewhat here. This feels a bit like taking a page out of the book of Bezos. Right? He was always known for driving down those, those prices in so many cases. And he's, you know, got that quote, your margin is my opportunity. He's taking that Uber long term view that, you know, A.C. i think for federal agencies, they're under this mandate to modernize while also managing tighter budgets at the same time. So, you know the old saying, cash is king. I think in this case it seems maybe cost is king and we're seeing other cloud providers kind of follow the same lead. Salesforce has done the same thing in regard to Slack, Google, Adobe. So this isn't anything necessarily new. But then I think for Oracle, you know, these discounts can help lock in really multi year contracts. Yeah. And that offers more stability for their business model and revenue prediction. And if they can extend those relationships, they can start talking a little bit about maybe exercising a little bit more pricing power down the road if they do a good job. So I can see both parties benefiting from that.

[Jason Moser]

I thought this was a little bit more beneficiary for Oracle when I first started studying it. But then I think the gsa, the General Service Administration is starting to shake their big stick here to try to get some pricing out of some of these big players. It is interesting to me that this is for the licensees, not really for the subscription. And it goes through November, the pricing option goes through November of this year. So it does give Oracle a foot in. It's really the first deal the GSA cut for government wide solutions, including lots of areas where Oracle and other cloud titans provide or provide some of those services and compete very heavily. So I think it's just more evidence of CFO Safra Cats becoming more and more competitive, trying to push Oracle into markets. Clearly Oracle has been some, has, has had some nice beneficiaries here in the markets and in their business. As the stock is, you know, gone really well. It's up 60% the past year or 40% year to date. Jason. It's now a, you know, it's north of a $600 billion company, 35 times earnings. That's almost two times its five year average. So what do you think about Oracle, the stock going forward?

[Andy Cross]

Yeah, I'm glad you brought that up. It does seem like a little bit of a richer valuation. But going back to Safra Cats, he's, he's looking at, you know, fiscal 2026 targets here. Cloud revenue growth projected to grow from 24% to over 40% and then that IaaS, that infrastructure as a service, that growth there is projected to hit about 70%. So anytime you see valuations like that, I mean you have to just kind of step back and say, okay, why is the market doing that? Where's the growth? And I think that's where they're seeing some of that growth now. They just have to deliver.

[Jason Moser]

Yeah, I think so too. I do. Again, like this licensing play because as they continue to push more subscription, this does get into the core part of what Oracle has done for so long and done so well for so many years. So I think it is a nice foothold for Oracle. I guarantee the GSA is going to be issuing lots of different kind of pricing asks of lots more providers as they continue to manage their own footprint, as they kind of push towards to be a little bit more technological savvy in the federal government. Finally today, Jason, stocks are down a little bit, but passed through all time highs last week. Let's end things with two stocks that we're keeping fresh on our watch list if the prices are right. What are you looking at?

[Andy Cross]

Everybody loves stock ideas, right? Acl?

[Jason Moser]

Yeah.

[Andy Cross]

One that I just continue to keep my eye on is a company called Samsara. Ticker is IoT. It's now a $22 billion company and Samsara operates its connected operations cloud, which is a software platform that connects all of the devices that a company has in its buildings, its equipment, its cars and other facilities. And the platform then establishes this massive network of data and information specific to that company. Now the company's still working its way to profitability. Basically, technically it's cash flow positive, but stock based compensation more than eats that up, which isn't uncommon for a company at this level stage of his life cycle. It's around 14 times forward sales projections today. Now when I wrecked this company in the trend service back in 2023, the beginning of 2023, it was at 13 times and it's, it's been a little bit, a bit of a bumpy ride and the stock has pulled back a little bit. But when you look at the fundamentals of this business, you know, they just reported for first quarter results that it exceeded all targets that leadership set a quarter ago. Revenue up 32%. Annualized recurring revenue up 31%. They have 2,638 customers with ARR over $100,000. That's up 35% from a year ago. So it is a company that continues to grow and establish a fairly dominant position in its market is what it seems. It really does. It does seem like this is becoming kind of the top dog at its space. And I think it's also a company that possesses a lot of those hidden gems traits, those principles that our CEO Tom Gardner loves, he's so fond of. Right. I mean you got reasonable, remarkable growth into expanding markets. Check right. Led and owned by true long term believers in the company. Check right. I mean this is a company that is led by co founders Sanjeev Biswas and John Bigot. They own almost 70% of the voting power and in a relentless curiosity towards bold technical exploration I mean that is a double check for a company like this. So if we ever see any kind of a material pullback in this one, I certainly would be very tempted to add it to my portfolio.

[Jason Moser]

Jason, anything, any. Do you have any thoughts on these cute kind of ticker names? IOT that does that, does that tend to scare you away from a company or.

[Andy Cross]

I, I, I, not really. I, I never would recommend a company on the, the, the ticker alone, but it made me, you just made me think of Core Scientific and it's, it's ticker cores. It's like the Smokey and the Bandit ticker. I just, it's funny to see those sometimes. Yeah.

[Jason Moser]

Jason, I'm looking at how met symbol hwm. It's a formal part of, formerly part of Alcoa. Its history is steeped into high precision metal working. 90%. It provides 90% of all structural and rotating aero engine components for the aerospace, transportation, energy markets. These are really super high end precision airfoils and forging, forged wheels and chassis for the commercial trucking and auto space. The stock has doubled over the past year and almost, it's up almost 50% since the rule breakers team over in Stock Advisor. We recommended it just this year. It has these really serious competitive advantages that we love to see. It's patents, manufacturing, the history behind it, it's core clients. You don't really want to mess around with replacement parts for these kinds of really high precision manufactured items. It does have some opportunities in the energy space because it provides the blades for a lot of these, for the engine turbines that power a lot of the energy that goes into supporting data centers. I do love this business. It's just the stock has done so well and while Rule breakers and the Stock Advisor team as well as our Rule breakers team love buying into strength. I just want to see, I'm not going to criticize anybody for adding this great business to his port to their portfolio. But for me I'm just looking for a little bit of value, maybe a market breather before I kind of start looking at helmet symbol HWM. Just a wonderful business, $73 billion. So it's not small and it has a lot of room to grow in the aerospace market.

[Andy Cross]

Yep, plenty of examples in my investing life where patience tends to pay off 100%.

[Jason Moser]

There you have it. Those two high quality companies and Samsara and Hammet that we're watching. If the markets go on a little bit of a, of a tailspin here in the dog days of summer, maybe they go added to our portfolio. That's a wrap for us today here at Motley Fool Money. Jason Moser, thanks for joining me here.

[Andy Cross]

Thanks for. Thanks for having me.

[Jason Moser]

Here at the Motley fool, we love hearing your feedback. To be part of that feedback or to ask a question, email [e-mail] that's podcastsool.com as always, people on the program may have interest in the stocks they talk about, and the Motley fool may have formal recommendations for or against. So don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. For all of us here at Motley Fool Money, thanks for listening and we'll see you tomorrow.