Shares of Comcast fell as much as 8 percent Monday after the company beat out Twenty-First Century Fox to acquire British broadcaster Sky, but climbed off session lows to end trading 6 percent down.
At its lowest Monday, the stock was on pace for its worst day since January 2009. Shares fell as low as $34.75 before paring some losses and closing at $35.63.
Comcast outbid rival Fox on Saturday with a $40 billion takeover offer in a rare three-round auction that pitted two of America's largest media companies against one another. Sky earlier Monday advised its shareholders to accept the offer "immediately."
The share price of the company that acquires another company often declines. But at least one analyst was bearish on the bid. Craig Moffett of Moffett Nathanson downgraded the stock to neutral from buy, and lowered its target price to $36 from $41.
"The concept of the 'winner's curse' is central to auction theory. By the very nature of an auction, the so-called 'winner' of an auction is the party willing to pay more for an asset than any other party believes it is worth," Moffett wrote in a note published Monday.
Sky, as a linear TV provider, could prove to be a burden for Comcast, Moffett said.
"Investors will now have to greet Comcast's earnings reports with the trepidation that comes from owning a secularly challenged asset … for which they grossly overpaid," he said.
With Monday's plunge, shares of Comcast are down more than 10 percent in 2018 and flirting with bear market territory, now 19 percent off 52-week highs.
Disclosure: Comcast owns NBCUniversal, CNBC's parent company.
