After outperforming for much of the past couple of years, the top media stocks all have been absolutely mauled on fears that bundling and younger Americans “cutting the cord” will totally change the revenue outlook. The fact of the matter is, while many are going to Netflix and similar streaming sources, the big networks and programming giants are not going anywhere.
In a new research report UBS acknowledges that while ever more advertising revenue is headed toward the digital arena, broadcast TV stations and cable networks still garner a large share, and with the group reasonably cheap and still showing growth, patient investors could make some serious money.
We selected four of the media stocks that are rated Buy at UBS that have been hit hard.
This company is a top consumer media company with multiple streams of income that got absolutely hammered after earnings that were less than expected prompted a big fear that consumers are cutting the cable cord. Walt Disney Co. (NYSE: DIS) has the movie studio business poised to improve, as with accelerating theme park business. The network programming continues to drive viewerships with extensive sports programming. Most importantly, the company produces tons of content that will keep it a long-term media alternative, and it recently announced that Star Wars-themed lands will be coming to Disneyland and Disney’s Hollywood Studios at Walt Disney World Resort.
The Disney Media Networks segment operates broadcast and cable television networks, domestic television stations and radio networks and stations. It is involved in the television production and television distribution operations. Its cable networks include ESPN, Disney Channels and ABC Family, as well as UTV/Bindass and Hungama. This segment also owns eight domestic television stations. Disney also was one of 24/7 Wall St. top 10 stocks to own for the next decade.
Disney shareholders are paid a 1.38% dividend. The UBS price target stays at $128, and the Thomson/First Call consensus target is $119.85. Shares closed most recently at $99.23.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.