“At the heart of it, the reason cable is winning – and it’s winning phone subscribers and it’s starting to win back broadband subscribers – is not because they have more products in the bundle, but because they have a marginal cost advantage," he added. "They can do it all on one network with one cost structure, one set of capital equipment – and nobody else can. They’re giving enough of that cost advantage to consumers that they’re starting to take back share across every single one of these product lines.”
Moffett said investors should consider selling EchoStar and DirecTV and buying Comcast and Time Warner.
“For growth investors, I think it’s Comcast and Time Warner,” he said. “It would be nice to be able to say one is preferred over the other, but frankly I think they’re going to trade with a very high correlation and they’re very similar stories. So, I don’t think there’s a strong preference between the two.”
He said cable growth rates are stronger than they’ve been in decades as companies re-invest to meet strong demand.
Telecom will be a factor in the battle, but faces a tough fight.
“Verizon’s footprint at the end of its capital program will only cover about 13% of the United States,” Moffett said. “Even if they get 20% market share, they’ll have 2.5% of the U.S. video market at the end of this project. That’s not to say that 20% isn’t successful, but it puts into context just how big a project it is.”
Paul Fremont, managing director at Jefferies & Company, told CNBC’s “Morning Call” that he has a strong outlook for electric utility stocks.
“We believe that, for the time being, you’re looking at prospects for much higher power prices,” Fremont said Tuesday. “So, at least for the next year or two with generation prices poised to increase $50 to $80 per megawatt hour -– which would nearly double the cost of power to end users –- we think the prospects for electric utility stocks have never been brighter.”