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Shares of AMC Networks (NASDAQ:AMCX) have risen 40% in 2012. The owner of television channels AMC, IFC, Sundance Channel, and WETV has "The Walking Dead" to thank for that. Sunday's Season 3 midseason finale of the hit zombie show saw record numbers and sets up a strong 2013 for the media company.

"The Walking Dead" became the first cable series to ever beat all other fall television series in the highly coveted 18-49 age demographic. In its third season on AMC, "The Walking Dead" beat "The Voice", "Modern Family", "X Factor", and "The Big Bang Theory". All of those shows air on network television, giving them a greater possible television audience.

The midseason finale saw over 10.5 million people tune-in. The finale aired again at 10 pm and 12 pm, giving the episode a total of 15.2 million viewers on Sunday. "Talking Dead", which is a discussion of the show that airs directly after, had 2.2 million viewers. The finale's 10.5 million viewers marks an increase of 58% from Season 2's midseason finale. Here is a look at the premieres and finales:

· Season 1 Premiere: 5.35 million

· Season 1 Finale: 5.97 million

· Season 2 Premiere: 7.26 million

· Season 2 Finale: 8.99 million

· Season 3 Premiere 10.87 million

Back in 2011, I wrote about AMC Networks being spun off of parent media company Cablevision (NYSE:CVC). At that time, shares were trading around $35. I recommended waiting until shares hit $30 to purchase them, unless if you were considering buying them as an acquisition target. I listed a buyout price of $40-$45 by a media company like Discovery Communications (NASDAQ:DISCA), Scripps Networks (NYSE:SNI), Time Warner (NYSE:TWX), CBS (NYSE:CBS), News Corporation (NASDAQ:NWS), or Lions Gate Entertainment (NYSE:LGF). None of those companies jumped on AMC and shares now trade at $52.25.

"The Walking Dead" continues to capitalize on the media zombie craze. The television show, based on a comic book series, has seen related merchandise readily available. McFarlane Toys created action figures based on the characters. Telltale Games created an episodic storyline video game. Activision Blizzard (NASDAQ:ATVI) secured the rights to make a 2013 video game based on the television series, that could possibly be a MMORPG.

AMC is in its fiscal fourth quarter, which ends with the last day of 2012. Analysts on Yahoo Finance are expecting the company to post earnings per share of $0.62. For the fiscal year, analysts see AMC earning $2.26, after posting earnings per share of $1.79 in fiscal 2011. In the last three quarters, AMC has beat analysts' expected earnings per share and currently sits on $1.69 in year to date earnings. The company should easily beat fourth quarter and full year estimates based on "The Walking Dead's" strong results. In 2013, analysts see the company earning $3.10, a number which will likely be updated and raised soon.

Season 3's midseason finale left off with a cliffhanger and the show continues to pick up more fans along the way. Both of these items set up well for the show's Season 3 February continuation. Viewer numbers and advertising rates will both rise, and should provide a nice set of revenue to the company. "Breaking Bad" will also wrap up in 2013 and should see strong numbers as well.

Strong numbers from "The Walking Dead" continue to put pressure on the cable networks that have had disputes with AMC Networks. Dish Networks (NASDAQ:DISH) recently ended their dispute with the media company and is now carrying all the AMC owned channels.

Shares are trading at the high end of their fifty two week high of $55.38. While shares sit trading with a forward price to earnings ratio of 17, AMC does not look that expensive. In January, the company could report strong fourth quarter numbers and strong 2013 guidance. Analysts are likely to come out in strong support of the stock soon. If there is a pullback to $50, shares should be bought.

Source: AMC Networks Could Have Monster Year With The Walking Dead