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Shares of media company Scripps Networks Interactive (NYSE:SNI) have been on a run, ever since Variety first reported Discovery Communications (NASDAQ:DISCA) was working on a bid to unite the two together. While several analysts praised the deal and the synergies it could bring for Discovery, a deal seems less likely to happen now. Investors should put the brakes on chasing Scripps shares at all-time highs and buy Discovery shares instead.

Discovery Communications recently beat analysts' estimates for the third quarter, which I predicted would happen back in July. The third quarter was the best in company history ever for the advertiser key 25-54 demographic. Total viewership was up 10% in prime time, led by a record "Shark Week" and other original series. Revenue in the United States increased 10% to $733 million. In the United States, distribution revenue saw an increase of 10% to $329 million. Advertising revenue increased 12% in the third quarter for the United States region.

During the third quarter, the company's namesake Discovery Channel saw viewership jump 18%. Shark Week, which has become an annual tradition, saw over 50 million viewers tune in for the best viewership in company history. TLC saw viewership increase 4% in the key women demographic. Animal Planet, which has been strong for male viewership, saw viewership increase 5% in the quarter. The channel remained a top 20 network for men for the third straight quarter. Destination America, a smaller channel from Discovery, saw an 18% boost in viewers in the 25-54 demographic. Velocity has become the fastest growing men's lifestyle network on cable and saw 30% more viewers in the quarter.

Discovery Communications owns 50% in two distinct joint ventures. The company owns half of the Oprah Winfrey Network. This channel saw a 50% surge in viewers during prime time. The channel continues to turn out original programming and content from Oprah Winfrey and Tyler Perry that have significantly boosted viewership. Discovery reported that advertising sales have been strong for this channel.

Discovery's other joint venture is a 50% share of The Hub, with Hasbro (NASDAQ:HAS). The channel airs children's programming, with a slant towards boy viewership. The third quarter marked the eighth consecutive quarter of double digit growth in viewership amongst kids ages 2-11. This channel continues to be a huge hit for advertising dollars, as toy companies continue to promote their products to this key audience.

One of the keys to Discovery Communications growth is its international expansion. In April, I highlighted the company's acquisition of SBS Nordic. Discovery paid $1.7 billion for 14 television networks in the Nordic region, containing assets in Denmark, Finland, Norway, and Sweden. After the acquisition, Discovery Communications has content aired in 217 countries.

During the third quarter, Discovery reminded analysts that they have opened offices in Turkey, Ukraine, and India. TLC is now aired in 165 countries, making it the most distributed women's brand in the world. During the third quarter, international revenue increased 59% to $620 million, nearly matching the total from the United States. International revenue continues to be the strength and should rise from increased advertising revenue in the region. In the third quarter, international distribution revenue increased 29% to $322 million. Advertising revenue in international markets increased 127% to $282 million.

After the initial report of an acquisition, analysts like Sterne Agee have quieted a deal with tweets like this. One analyst gives his odds of a deal at 10%, which seems to make a deal very unlikely going through. Disney and other media companies have also been linked to Scripps, which means a bidding war or too high of a price could come for Discovery to stay involved.

There is still a small chance that Scripps Networks will be acquired by Discovery Communications. Shares of Discovery should see a small pop if this happens. Scripps is the owner of Food Network, HGTV, Travel Channel, and other lifestyle networks that fit well with Discovery Communications' lifestyle brands. A deal would unite two key players in the cable television sector and bring better pricing power to Discovery Communications to get more from cable providers as it bundles channels together.

Shares of Discovery Communications are up 29% in 2013. Despite strong earnings and the recent rumors, shares of Discovery are down from year highs, set close to the $90 range ($89.58). Analysts on Yahoo Finance expect the company to post revenue growth of 24% in fiscal 2013 and 12% in fiscal 2014. Earnings per share are expected to hit $3.06 and $3.96 respectively for the next two fiscal years. Shares trade with a semi-rich forward price to earnings ratio of 21. However, the media company continues to see double-digit gains on the top and bottom line, which bodes well for long-term and growth investors. Analysts are forecasting fiscal year revenue of $5.55 billion. During the third quarter, Discovery gave guidance in a range of $5.55 to $5.625 billion, leaving room for a huge year end beat.

Discovery Communications will continue to be in the rumor mill as cable consolidation heats up. The company will also be seen as a risky play with cord cutting going on and cable providers trying to cut costs. Discovery owns great niche, highly targeted channels that should be among the most wanted if an a la carte channel package ever comes to be. To me, Discovery is a safe bet on content and advertising revenue with its targeted audiences.

I have been a vocal bull of Discovery Communications for quite some time. The company has huge niche media assets in Discovery Channel, Animal Planet and TLC. Discovery also has key joint ventures with the Oprah Winfrey Network and The Hub. A deal with Scripps would make this a great media play for investors. However, without Scripps Networks' channels, Discovery Communications is still a buy with strong assets and coming international growth.

Source: Don't Chase Scripps Network Rumors, Buy Discovery Communications Instead