Mon, Sep. 28, 8:24 PM
- U.S. media firms have good reasons to expand internationally, but it might not be enough to address the challenges of "the three-headed monster" of YouTube, Netflix and Facebook, Morgan Stanley says.
- In a media update, Morgan Stanley's Benjamin Swinburne says those three could pose problems for media firms in Europe and Asia just as they have in America.
- "While Netflix's global scale gives it a competitive advantage over incumbents in acquiring content, the relative pricing advantage of Netflix vs. incumbent pay TV is much lower (overseas)," Swinburne writes.
- Still, despite the continued scaling of online platforms, "the advertising outlook for international pay networks is stronger than in the U.S."
- Among the firms that are making moves overseas -- including Discovery Communications (DISCA -0.2%), which is moving most aggressively -- Swinburne's top media picks are Twenty-First Century Fox (FOX -2.2%, FOXA -2.1%) and AMC Networks (AMCX -4.8%).
- Fox got 33% of 2014 revenue from overseas, compared with Discovery's 51%.
Wed, Sep. 16, 10:20 AM
- With traditional pay TV subscribers on the wane, a potential purchase of Starz (STRZA +5.6%) is not the best way to spend AMC Networks' (AMCX -1.1%) "M&A powder," says Stifel Nicolaus' Benjamin Mogil.
- Adding Starz won't change AMC's affiliate positioning, he writes, though for Starz (up solidly today), the combination makes more sense as a way to accelerate a possible discussion with Lions Gate (LGF +0.9%).
- He rates AMC Networks as a Buy and Starz at Hold.
- A deal here could speed up additional consolidation in the space, writes Macquarie's Amy Yong, who holds a Neutral rating on AMCX and Outperform on STRZA.
Tue, Sep. 15, 5:39 PM
- Starz (NASDAQ:STRZA) is up 7% in after-hours trading on news that it's in talks to be acquired by AMC Networks (NASDAQ:AMCX), itself up 2.5% after hours.
- Bloomberg reported the preliminary talks, which come after a few abortive attempts by suitors to acquire Starz in the past year. “They probably ultimately need to combine with others at least from a bundler point of view, if not from an ownership point of view,” John Malone -- Starz's top individual investor -- said last week.
- An AMC deal would require the sign-off of the Dolan family, who control voting power after AMC was spun off from Cablevision four years ago.
- Starz has a market cap of $3.9B and an enterprise value that's grown to more than $5B from $4B last year, during a period when it was often linked to Lions Gate Entertainment (NYSE:LGF). Shares in Starz are up 26.1% over the past 12 months.
Mon, Aug. 24, 6:22 PM
- Worries about generating new hit programming are put off -- at least for another while -- for AMC Networks (AMCX -3.1%), as last night's premiere of prequel series Fear the Walking Dead smashed records and became the most-watched debut in cable history.
- The broadcast grabbed 10.1M viewers with an extended 90-minute premiere. That compares to the network's previous marks: 5.35M viewers in 2010 for the debut of ratings monster The Walking Dead, passed earlier this year with the 6.88M viewers who watched the beginning of Better Call Saul.
- The 10.1M one-day is huge even ahead of live-plus-three-day timeshift ratings to be seen later this week -- very strong live viewership numbers (and therefore ad measurables) in an age of slow decline for linear TV.
- The show drew 6.3M viewers in the adults 18-49 demographic. It's rolling out with a short six-episode season before settling into a longer second season in 2016.
- Previously: 'Mad Men' finale another turning point for AMC (May. 17 2015)
- Previously: 'Walking Dead' finale dominates Sunday night (Mar. 30 2015)
Wed, Aug. 19, 5:57 PM
- While it was Walt Disney (NYSE:DIS) that got the blame for a media sector downturn earlier this month amid worries about cord-cutting (spurred by the Mouse House's talk about ESPN subscriber losses), it's not the one who might suffer the most from declining fees.
- Sanford Bernstein did an analysis of media companies' exposure to drops in per-subscriber fees, and while Disney was in the middle of the pack -- earnings would fall 8.7% if domestic affiliate fees fell 10% -- the company with the greatest exposure is AMC Networks (NASDAQ:AMCX), whose EPS would fall 16.6% with a 10% fee drop.
- On the other end of the spectrum, the company most insulated is CBS. Its earnings would fall only 3.2% with the same 10% decline in domestic affiliate fees; while it has exposure to cable subscriptions via Showtime, it's primarily a broadcast network.
Thu, Aug. 6, 1:01 PM
- Disney (NYSE:DIS) is down another 5.2% today (down 13.7% in two days) amid a deepening media stock sell-off that it seems to have spurred with its Tuesday earnings report, where it took a fair chunk of time on an analyst call acknowledging subscriber losses at ESPN.
- Also off broadly at midday: CBS -3.1%; CMCSA -4%; FOXA -9.8%; VIAB -15.6%; TWX -5%; AMCX -9.6%; LGF -6.7%.
- The sell-off is affecting several companies with a cable or pay-TV component, as sub losses at ESPN -- the most valuable part of any cable bundle -- point to the effect of cord-cutting.
- Analysts are agreeing that the trend of unbundling (or skinny bundling) might threaten the long-term health of the pay TV ecosystem, which has profited from the promise of rising subscription fees from providers. That's dependent on subscriber counts that don't significantly drop off.
- A growing pile of reports this week is indicating warning signs for subscriber counts. Dish Network (DISH -2.2%) had "almost certainly the worst quarter" for satellite subscriber losses, analyst Craig Moffett noted, as it merged Sling TV subscriber growth into its overall count, masking the core number. Moffett estimates Dish lost 151K satellite TV customers in Q2.
- Subscriber losses mean lower affiliate fees. Disney said in its call "we now expect domestic cable affiliate revenue [growth] to fall short of previous expectation, but still in high single digits."
- Other industry decliners: CRWN -8.9%; QVCA -5.4%; STRZA -6.1%
- Previously: Disney tumbles 8.9% after revenue miss; Iger talks ESPN again (Aug. 05 2015)
- Previously: Disney's Iger bullish on ESPN despite consumer changes, unbundling (Aug. 04 2015)
Thu, Aug. 6, 10:03 AM
- AMC Networks (NASDAQ:AMCX) is off sharply, -7.7%, as international revenue dropped for the first time in nine quarters, spoiling a Q2 beat it pulled off largely due to a stake in BBC America.
- The company pointed to foreign exchange fluctuations as the cause of the international decline.
- Revenue by segment: National Networks, $488.6M (up 22.8%); International and Other, $112.9M (down 9.4%).
- Adjusted operating cash flow sank internationally along with revenues (expenses essentially flat), down 56% to $8.6M. AOCF at National Networks grew 33% to $182.5M.
- Conference call is beginning now.
- Press Release
Thu, Aug. 6, 8:06 AM
Wed, Aug. 5, 5:30 PM
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Thu, Jul. 16, 12:25 PM
- A clear winner from today's announcement of the nominations for Emmy Awards was HBO's (NYSE:TWX) Game of Thrones which landed 24 nominations, including one for outstanding drama series.
- HBO has 126 nominations overall vs. 99 a year ago.
- Netflix (NFLX +16.6%) landed 34 nominations to top last year's 31 nods. The streaming service also had a higher weighting in top categories.
- AMC (NASDAQ:AMCX) also did well with two series, Mad Men and Better Call Saul, in the category for best drama series.
- Full list of Emmy nominations
Mon, Jul. 13, 7:51 PM
- Standard & Poor's has a report out comparing winners and losers in a new era of television -- largely dependent on attributes that will let them weather Internet-driven changes to things like traditional business models and bundling.
- Naveen Sarma points to four traits for long-term success in media: "strong, well-defined brands that translate across both traditional TV and online alternatives; limited exposure to second- and third-tier cable networks; less dependence on full-sized video bundles; and willingness to let vulnerable networks fail."
- Based on that, winners who have more of those qualities: CBS (NYSE:CBS), Comcast (NASDAQ:CMCSA), Time Warner (NYSE:TWX), Twenty-First Century Fox (FOX, FOXA) and Walt Disney (NYSE:DIS).
- Losers who might struggle: AMC Networks (NASDAQ:AMCX) and Viacom (VIA, VIAB).
Tue, Jun. 30, 4:14 AM
- Bringing months of negotiations to an end, European lawmakers have agreed to a final proposal to scrap roaming charges within the 28-member union as of June 2017 and introduce rules on "net neutrality."
- Unlike stricter laws in the U.S., the EU will allow specialized services for things such as streaming live TV as long as it does not hinder other customers - a move likely to be welcomed by telecoms groups.
- Related tickers: AMCX, VOD, ORAN, TI, TEF, BT, OTCQX:DTEGY, OTCPK:HUWHY, OTCPK:TLTZY
Thu, Jun. 25, 4:24 PM
- AMC Networks (AMCX +1.8%) is making its AMC Studios division a stand-alone studio, with production operations under separate new leadership -- a reflection of the growth in its network-owned series.
- Rick Olshansky (currently head of business affairs) and Stefan Reinhardt (senior VP of finance and studio operations) will be co-chiefs of the studio. Joel Stillerman, who was leading production efforts, will focus on development for AMC and SundanceTV.
- AMC has been increased its owned programming not only to populate its domestic networks, but also a growing percentage of international programming.
- The move's similar to one that A&E Networks (50% owned by Disney) made last year.
Tue, Jun. 23, 5:01 PM
- AMC Networks (NASDAQ:AMCX) slipped 1.1% today following a downgrade to Hold from Topeka Capital analyst David Miller, "for the simple reason that the stock has performed in line with our Buy rating."
- The shares were up 28.6% YTD and up 27.3% since they initiated Buy coverage on Feb. 3, 2014, he notes, showing how sentiment has wheeled from "unloved" in 2014 to "bid up" this year.
- Exogenous events were a problem last year, he writes: Fund redemptions in April and May, a miss in Q2, and a delay for Breaking Bad spinoff Better Call Saul (which proved to be a 2015 hit).
- With the price gains, M&A is less of a prospect as well, he writes: "(While) AMCX would make a wonderful acquisition for any one of the six bellwether large-cap Media names, interest in acquiring the whole enterprise seems to be tepid. More specially, if core mothership AMC -- just AMC -- were put up for sale, then interest would be higher, but interest in AMCX's other linear networks, those being IFC, WE and Sundance, seems tepid at this time."
- He does see comparably strong revenue and EPS growth in the second half, amounting to double-digit gains.
Wed, Jun. 3, 4:41 PM
- A revitalized John Malone is ready to push consolidation across media firms, with his eye on content now that the Charter-Time Warner Cable wheels are in motion.
- The "bundle" is coming apart, he tells the WSJ, and as he hinted at earlier this spring, Lions Gate (NYSE:LGF) could play a key role in content mergers.
- “Lions Gate could buy Starz (NASDAQ:STRZA) and potentially other free radicals in the industry,” Malone said. Scripps Networks Interactive (NYSE:SNI) or AMC (NASDAQ:AMCX) could be targets though those agreements might be difficult.
- Malone engineered a stock-swap earlier this year between Lions Gate and Starz that put him on LGF's board in exchange for 4.51% of Starz, and Lions Gate was reportedly close to a Starz buyout before valuation concern killed the deal.
- Asked at an investor meeting about CBS and Viacom, Malone didn't announce any plans, pointing to the Sumner Redstone succession issue (Redstone controls near 80% of both companies) -- though there's wide belief that either could be for sale after Redstone's death.
- Aside from his involvement in Starz and Lions Gate, Malone also has a 29% voting stake in Discovery Communications (NASDAQ:DISCA) as well as a stake in ITV (OTCPK:ITVPF), not to mention his position in the various Liberty companies. (Liberty Broadband is backing Charter in its TWC takeover.)
- After a flat day, Starz spiked 1.5% heading into the close, and Lions Gate finished the day up 1.8% as Malone's comments came to light.
Tue, May 19, 12:33 PM
- Ad-industry drama Mad Men drew 3.3M live and same-day viewers in its series finale for AMC Networks (NASDAQ:AMCX) -- an expected increase (74%) over its typical draw, but short of the endings for other cable hits, like the network's own Breaking Bad (10.3M comparable viewers).
- That's the show's third-highest audience ever, though it did hit a series high for adults 25-54, up 70% from the prior week to 1.7M viewers.
- Ratings may do better in Nielsen's Live+3 ratings (with three days of time-shifted viewing) -- Mad Men is a heavily DVR'd show.
- The network now looks ahead to summer-season premieres of Halt and Catch Fire and Humans, but especially premade hit Fear the Walking Dead later in the summer.
- Previously: 'Mad Men' finale another turning point for AMC (May. 17 2015)
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