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CBS finsihed the day down 0.9%, swimming against broader market gains after a quite positive earnings report after the bell yesterday.
- BMO Capital's Daniel Salmon took the opportunity to reaffirm the broadcaster as his top media pick. He's keeping a $58 price target -- 10 times 2016 OIBDA, 14.5 times 2016 EPS, and an implied upside of 34%.
- Solid results might not drive a gain in the current market, he acknowledges, but it should outperform peers in the future "as investors continue to reassess the health of the pay TV ecosystem and better appreciate CBS’ limited exposure to the cable bundle."
- Among keys to his bullishness: resilient broadcast advertising and catalysts ahead, reiterated guidance on retrans and reverse retrans revenue, and strength at Showtime and at the CBS and Showtime over-the-top products.
- In a tough market for media stocks, CBS is down 14.3% over the past three months.
- Previously: CBS call: Even stronger times ahead with advertising, streaming (Feb. 11 2016)
- Previously: CBS beats on revenue, meets on profits for Q4 (Feb. 11 2016)