- After getting a boost yesterday from an earnings report that featured its strategic revamp, Viacom (VIA, VIAB -0.8%) has earned a downgrade from Barclays even as other analysts raise price targets.
- Barclays has gone to Equal Weight from Overweight, saying the company has a "rational and credible" plan but will need a delicate execution.
- "The company’s challenge ... will be to make this transition in at least a revenue neutral manner," write Kannan Venkateshwar and team.
- "Given that Viacom faces more a terminal value question, what we think the new plan will need to do is to generate more revenue and operating income on a smaller base of assets, in a saturated market at media networks. This will have to be done in an environment where none of the secular sources of pressure seen by Viacom in the form of demographics have seen any signs of change."
- Barclays has a price target of $45 on VIAB, implying just 3% upside.
- Meanwhile, BMO boosted its target to $44; Guggenheim has raised its price target to $50; and Bank of America has raised its target to $52, implying 19% upside.