Comcast (CMCSA) posted a decline in first-quarter earnings but matched Wall Street estimates. The Philadelphia-based cable system operator made $732 million, or 24 cents a share, for the quarter ended March 31, down from the year-ago $837 million, or 26 cents a share. On an adjusted basis, excluding certain unusual items, earnings rose to 19 cents a share from 17 cents a year ago. Revenue rose 14% from a year earlier to $8.4 billion, beating the $8.2 billion analyst estimate.

“Our performance demonstrates that our operating strategy is working in an economic and competitive environment that continues to be challenging,” said CEO Brian Roberts. Comcast lost 57,000 basic video subscribers, but added 494,000 digital cable subscribers. The company said 65% of video subscribers now have digital service, up from 55% a year ago, and 43% have so-called advanced services like digital video recorders or high-definition TV, up from 38% last year. The company also added 492,000 high-speed Internet users and 639,000 Comcast Digital Voice phone customers.

Comcast, which recently began paying a quarterly dividend for the first time in more than a decade, said it spent $1 billion buying back stock in the quarter. Comcast made $3 billion in repurchases last year as its shares fell, but this year the buybacks seem to have had the desired effect, as Comcast shares rose 6% during the first quarter.

Comcast (CMCSA) is trying to get back in investors’ good graces. The Philadelphia-based cable giant posted a stronger-than-expected fourth quarter, rolled out another big stock buyback plan and said it will pay a quarterly dividend for the first time in nearly a decade. Comcast made $602 million, or 20 cents a share, up from the year-ago $390 million, or 13 cents a share. Revenue rose 14 percent from a year ago to $8.01 billion. Analysts were looking for a 17-cent profit on sales of $7.9 billion. The solid quarterly showing breaks a string of disappointing results at Comcast that had sent the stock plunging 40 percent from its highs over the past year, in spite of Comcast’s efforts to put a floor under its stock through an earlier stock-repurchase plan.

“In 2007 we delivered very healthy growth in revenue and operating cash flow, added substantial revenue generating units and generated significant earnings growth - despite a weak economy and intensified competition in the second half of the year,” said CEO Brian Roberts. “For 2008, we are confident about our competitive position and our ability to further grow our business, as illustrated by our outlook for 2008 free cash flow growth of at least 20%.”

Underlining that optimism, Comcast said it will start paying quarterly dividends at a 6.25-cent rate and plow an additional $7 billion into buying back stock. Shareholders can only hope the latest buyback will help Comcast reverse the decline in its shares. The company spent more than $3 billion buying back stock last year, but it paid an average of $23 a share - a 30 percent premium to the stock’s closing price Wednesday. Say what you will about returning cash to shareholders, but that’s money down the drain.