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Experienced financial writer with a BA in Finance from one of the biggest business schools in the country. Currently a full-time writer, eclectic resume with diverse experiences; including, front-office, back office, full-service broker, sales support, retail banking, investment marketing, bond... More
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  • Overview Of Viacom After Its Q1 Results 0 comments
    Feb 5, 2013 10:07 AM | about stocks: VIAB, VIA, DIS, DWA, TWX, NWSA

    Viacom, engaged in the principal businesses of film and TV entertainment, experienced a decrease in revenues by 16%. Excluding their Nickelodeon losses they had net positive earnings, however. In addition, they will pursue repurchasing $700 million of their own stock.

    In the movies and TV entertainment markets, Viacom controls some of the biggest networks and distributors of TV, movie, internet and home video entertainment, including Paramount Studios, MTV, BET, VH1, Comedy Central, Spike TV, Nickelodeon and Epix.

    The two main segments of businesses at Viacom are media networks and film entertainment. In their latest earnings release for Q1 2013 the executive team highlighted that Tom Cruise's 'Jack Reacher' performed very well in its opening box office weekend in the U.S. and internationally. Also selling well with a number one opening in the U.S. was 'Hansel & Gretel: Witch Hunters'.

    Other major movie franchises owned by Paramount Studios include 'Paranormal', 'Anchorman', 'Star Trek', and 'G.I. Joe' all with sequels being released this year. 'Paranormal 4' released in 2012 opened with $29 million in box office receipts, down from the previous installment's weekend box office opening of $52.57 million. Despite their franchise successes at the box offices, they are witnessing woes in Europe from their economic uneasiness.

    Highlighted in the call was 'Catfish', the number one new TV series on MTV, other hit shows include 'Washington Heights','Buckwild', 'Awkward', and 'Nick & Sara Live'.

    The executive team maintains a positive outlook on Nickelodeon's slump with an adamant approach to the youth and teen demographics. With many hit shows the company esteems itself with having a good pulse of their viewers.

    Here's a look at recent performance for Viacom, comparing the company's period returns to its industry and market benchmarks:

    (click to enlarge)Viacom performance

    Year-to-date viacom has well outperformed its peers. Yet on a one year return basis it has been remarkably break-even to the industry. This bump in the road was also experienced in its latest quarter results.

    What's also remarkable is how Viacom is a darling to stock analysts with a very bullish outlook in its analyst score despite its past lackluster earnings and revenue growth. Here's a breakdown of key statistics compared to its closest industry peers.

    (click to enlarge)data from Fidelity

    (Data from Fidelity)

    Viacom is situated as such that it could knock the dust off its dismal two stars awarded by Morningstar research and add to its stars.

    That leads into the movie lineup for Paramount Pictures which should be poised to do very well projecting $102.54 million in box office opening months per film in 2013.

    Here's the release date calendar for all the 2013 films:

    (click to enlarge)Compiled from Hollywood Stock Exchange

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Additional disclosure: The "analyst score" is an aggregate mean of StarMine rankings by top industry analysts covering the stock.

    Stocks: VIAB, VIA, DIS, DWA, TWX, NWSA
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