(MONEY Magazine) – Recent price $28

Comcast's March bid for Disney marked another episode in the debate over whether distributors, whose wires carry TV signals into our homes, or programmers, such as ESPN, hold sway in the media world. Investors feared that Comcast's offer to buy Disney was an admission of weakness, and though the bid lapsed, Wall Street remains spooked. The stock of the best-managed company in the cable industry, Comcast (CMCSK), trades 20% below February's high, making it alluringly cheap.

The real story at Comcast is how the billions of dollars spent wiring America with fiber-optic cable is paying off as consumers race to sign up for new broadband and phone services. So while the Disney drama grabbed headlines, Comcast notched 10% sales growth for the first quarter of 2004. Operating income more than doubled, to $702 million, and the company says it should generate $2 billion in free cash flow this year.

Comcast's strength is its ability to piggyback other offerings--such as phone service--onto its fiber network, says T. Rowe Price Value manager John Linehan. "The incremental cost for it to deliver telephony is minimal," Linehan says. (Comcast plans a national rollout of Internet telephony in 2005.) At twice the size of the next largest cable operator, and with a granite balance sheet, Comcast is well equipped to press its advantage. Yet the stock, at $28, trades as if it were an also-ran. Call it the Disney hangover, and grab some shares before it goes away. --LISA GIBBS