AMC Networks: The Price Is Much More Logical, But Risks Continue
Vince Martin • 14 Comments
Vince Martin • 14 Comments
AMC Networks Still Doesn't Look Cheap
Fri, Jul. 15, 2:03 PM
- Network stocks CBS, Discovery Communications and AMC Networks have headed lower today as UBS downgrades them in a new update.
- CBS fell 3.1%, erasing the past week's gains, as analyst Douglas Mitchelson suggested ad strength is priced in and might wane in the second half, especially amid the intensifying competition of presidential campaign ad season.
- UBS downgraded it to Sell from Neutral and kept a $52 price target (about 7% downside from today's lower price).
- Similarly, second-half concerns weigh on Discovery (DISCA -2.3%) and AMC (AMCX -4%) as Michelson worries about their ability to diversify away from focus strengths, and downgrades to Sell In AMC's case, it will need a hit to replace a weakening The Walking Dead; and UBS is concerned that neither AMC nor Discovery can make it into a new skinny bundle from Hulu.
- AMC is sitting just 3.5% over its 52-week low, while Discovery is just 6.2% over its 52-week low.
Thu, May 5, 2:08 PM
- AMC Networks (NASDAQ:AMCX) has gained 5.6% on heavy volume today after posting earnings that beat expectations solidly, with strength from licensing its content.
- Strong growth in its national networks (AMC, WE tv, BBC America, IFC and SundanceTV) was paced by distribution revenues that grew 10.7% to $335M, which includes digital distribution and licensing fees as well as increasing affiliate fees.
- Revenue by segment: National networks, $598.6M (up 6.4%); International and other, $109M (up 2.5%). Adjusted operating cash flow was up 10.9% in National networks to $280.95M, down 10.1% to $5.11M internationally.
- International results showed some surprising strength, with AMC Networks International showing gains partly offset by declines at IFC Films.
- Press Release
- Now read AMC Networks Still Doesn't Look Cheap »
Tue, Apr. 19, 7:53 PM
- With college basketball putting away the equipment after its tournament, Fox News (FOX -0.1%, FOXA -0.3%) reclaimed the top spot in prime-time cable ratings from TBS (TWX -0.5%), drawing 1.8M viewers on average.
- TBS and HGTV (SNI -0.5%) tied for second place with 1.5M viewers, while Turner's TNT tied with ESPN (DIS +1.1%) for fourth, with 1.4M.
- On the all-day basis, Nickelodeon (VIA -7.1%, VIAB -8.3%) was in a familiar spot at the top, with 1.1M viewers, ahead of Fox News, Adult Swim, Disney Channel and HGTV (though Viacom investors' eyes are on tense negotiations with Dish Network). And ESPN took the adults 18-49 demographic with 734K viewers.
- Zombies are still killin' it for AMC Network (AMCX -0.6%), as Fear the Walking Dead was cable's top show for the week, with 5.5M viewers topping CNN's Democratic Debate with 5.4M and TNT's Memphis/San Antonio NBA playoff game, with 3.9M.
- Now read Viacom: Opportunity Hidden In A Soap Opera »
Tue, Mar. 8, 3:54 PM
- CBS (CBS -1.3%), lately a dominator of prime-time TV ratings, made a little room in the top 10 for NBC this week.
- For the week ended Sunday, Fox News (FOX -1%, FOXA -1.5%) prevailed with its coverage of the last Republican presidential debate -- but not by much. The debate drew 16.8M viewers, just ahead of CBS juggernaut NCIS with 15.45M.
- Meanwhile, two nights of singing show The Voice on NBC (CMCSA -1%) made their mark, with Monday and Tuesday broadcasts finishing at No. 3 and No. 5 with 13.3M and 12.3M viewers respectively, and sandwiching The Walking Dead (AMCX -2.2%), at No. 4 with 12.8M.
- From there, the top 10 was all CBS again. NCIS: New Orleans, 60 Minutes, Madam Secretary, The Big Bang Theory and Criminal Minds rounded out the list.
Mon, Mar. 7, 11:20 AM
- AMC Networks (NASDAQ:AMCX) is seeing a pop today, up 2.7% after announcing its first stock repurchase program.
- The company authorized up to $500M in buybacks of its common stock. "We believe this stock repurchase program provides us with additional flexibility for capital allocation while preserving our strong balance sheet and allows us to continue to pursue growth opportunities," says CEO Josh Sapan.
- Timing and amount of buybacks will come down to market conditions. The program doesn't have a closing date set.
Thu, Feb. 25, 2:05 PM
- AMC Networks (NASDAQ:AMCX) dropped on good news again, off 5.9% despite its Q4 report where zombie success led to the advertising gains on its flagship channel that carried the quarter.
- Revenues grew 11% -- led by National Networks, though the company grew sales internationally as well -- and adjusted operating cash flow was up to $197M.
- Revenue by segment: National Networks, $562.3M (up 12.5%); International and Other, $119.2M (up 8.1%). Intersegment eliminations came to $2.6M.
- Revenue growth was paced by a 13.4% increase in ad revenues, mainly at AMC channel (bolstered by mainstay ratings smash The Walking Dead as well as successful rollouts of Better Call Saul, Fear the Walking Dead, and Into the Badlands). International gains got a boost from IFC Films and AMC Networks International, where constant-currency growth was (unsurprisingly) partly offset by forex fluctuation.
Wed, Feb. 17, 7:30 PM
- Only a competing Republican debate could have messed this up for CBS -- so luckily, it was the network who broadcast this week's.
- The network swept the top 10 shows in the ratings, with the exception of The Walking Dead on AMC, which finished third with 13.7M viewers. But the other nine of the top 10 programs were all on the Tiffany Network.
- CBS (CBS +3.7%) says that's the first time in a decade that one of the major broadcasters has pulled that off.
- Saturday's GOP debate was the No. 4 program, with 13.44M viewers. Topping the list were NCIS, with 16.94M, and The Big Bang Theory, with 16.25M. A pair of NCIS spinoffs, along with Scorpion, Blue Bloods, Madam Secretary and 60 Minutes filled out the rest of the list.
- TNT (TWX +2.2%) topped cable networks, averaging 2.37M prime-time viewers, ahead of Fox News' (FOX +3.3%, FOXA +3.4%) 2.33M and AMC's (AMCX +3.2%) 1.96M. In news, NBC Nightly News (CMCSA +0.4%) led with 9.4M viewers.
- In the season so far, CBS is unsurprisingly tops in prime-time viewers overall with an average 11.74M.
- Previously: 'Walking Dead' midseason premiere ratings down, but still big (Feb. 17 2016)
Wed, Feb. 17, 7:01 PM
- The Walking Dead, AMC Networks' (AMCX +3.2%) monster hit and flagship TV show, returned with a midseason premiere Sunday that pulled off that rare feat of disappointing despite huge numbers.
- The show drew a 6.8 rating among adults 18-49 (down 15% from comparable premiere last year), and 13.7M viewers (down 12%) in live-plus-same-day estimates -- not up to the level of past episodes, but still outdrawing broadcast-network hits.
- A holiday weekend and a Valentine's Day premiere couldn't have helped, not to mention the NBA All-Star Game (7.61M viewers on TNT and TBS (NYSE:TWX)) and a basic-cable premiere of Disney's Frozen. (3.9M viewers). AMC is looking forward to some help from delayed-viewing ratings.
- But the show's streak of growing ratings every half-season peaked a year ago when the end of season five dipped below the first half.
- The season premiere of follow-up show Talking Dead drew a 3.1 rating in the demo and 6.44M viewers overall, better than all eight fall episodes.
- Previously: Piper Jaffray sees growth ahead, reiterates Overweight on AMC Networks (Jan. 07 2016)
Mon, Jan. 4, 3:30 PM
- Pacific Crest's Andy Hargreaves is expecting a strong year for media networks and is still bullish on a subset of network stocks as top sector picks for 2016: Twenty-First Century Fox (FOX -2.8%, FOXA -2.7%), AMC Networks (AMCX +0.1%), Netflix (NFLX -5%) and Time Warner (TWX -0.3%).
- Hargreaves has Overweight ratings on all of them. He had called out AMC, Fox and Netflix for praise in the past.
- After a tough year for media stocks, he believes fundamentals are lining up for 2016, including election-year advertising, amid lowered market expectations.
- The group's average multiple is close to historical averages and below the broader market, "which creates a slightly positive risk/reward around valuation, in our view."
- Two possible negative catalysts come if negotiations between Viacom (VIA -2.2%, VIAB -1.6%) and Dish Network (DISH -0.4%) take a bad turn, and if Thursday Night Football bidding follows a trend of skyrocketing sports rights costs.
- Previously: Pacific Crest on media: Strong on AMC Networks, Fox, Netflix (Nov. 17 2015)
Mon, Jan. 4, 1:23 PM
- AMC Networks (NASDAQ:AMCX), down as much as 3.4% earlier, has made up its day's losses and moved positive (+0.2%) on news that it's reached a carriage agreement in a high-profile programming dispute.
- The company reached a deal with the National Cable Television Cooperative, a coalition of independent cable providers, ending a blackout dispute that threatened programming in the new year.
- The two had extended their contract to keep AMC programming (including AMC, IFC, SundanceTV and We TV) available on millions of set-top boxes while they discussed a new contract.
- Terms weren't immediately disclosed, but will be heavily scrutinized as AMC was said to be pursuing payment for all of a cable network's subscribers, not just the ones receiving AMC channels.
- Previously: AMC, indie cable operators in New Year's blackout showdown (Dec. 31 2015)
Dec. 30, 2015, 5:25 PM
- Nielsen has awarded its TV series ratings crown for 2015, and football is still the king.
- Sunday Night Football on NBC (CMCSA -1.5%) drew 23.3M viewers to top the charts among regularly scheduled series ahead of a pair of CBS (CBS -1.1%) shows. The Big Bang Theory and NCIS drew 21.1M viewers and 20.9M viewers respectively to take the next two spots for the Tiffany network.
- A cable monster was fourth: The Walking Dead (AMCX -1.8%) pulled 19.7M viewers.
- Unsurprisingly, football dominated the individual-show performances, marking nine of the top 10 programs (the uninvited guest was ABC's (DIS -0.7%) broadcast of the Oscars).
- The rest of the top 10 series: No. 5, Empire on Fox (FOX -0.9%, FOXA -1%); No. 6, Thursday Night Football (CBS, NFL Network); No. 7, NCIS: New Orleans on CBS; No. 8, Sunday Night Fooball Pre-Kick on NBC; No. 9, Blue Bloods on CBS; and No. 10, Dancing with the Stars on ABC.
Dec. 15, 2015, 5:08 PM
- AMC Networks (AMCX +2.4%) is gearing up for a contentious new front in carriage disputes: targeting cord-shavers by demanding that a number of small cable providers pay the network for every subscriber, whether or not they receive AMC channels.
- The move would amount to insurance against skinny bundles, says the CEO of the National Cable Television Cooperative, representing about 750 small operators with 4M customers.
- It's also a break from standard practices, where networks got paid based on subscribers who received them, and thus pressed to get into bundles that reached a high percentage of the customer base.
- The NCTC and some member operators have already held a conference call with he FCC seeking relief, saying it hinders operators' ability to offer some customers a "skinnier" package of programming.
- NCTC chief Rich Fickle says AMC is demanding a 10-year deal with $2/customer per month, twice the market rate from other operators, and for all its networks to be put in the most widely distributed package.
- AMC Networks provides AMC, WE tv, IFC, SundanceTV, BBC America and BBC World News to U.S. customers. The company's stock is up 1.3% after hours.
Nov. 17, 2015, 2:43 PM
- Amid a stressed-out media market, Pacific Crest's Andy Hargreaves still has a positive view of TV networks in the near term, and points to is "favorite longs" in the space: AMC Networks (AMCX +3.5%), Twenty-First Century Fox (FOX -1.1%, FOXA -0.9%), and Netflix (NFLX +3.8%).
- He's got Overweight ratings on all three. Fox should benefit from sustainable pricing power from its sports assets as well as improving global profitability; meanwhile, Netflix is proving to be "right" about the direction of media distribution, and while competitor's efforts are likely to dilute margin, it's still got a dominant position in streaming, he writes.
- He has a price target of $140 on Netflix (21% upside from current price) and $35 on FOXA (16.6% upside).
- On the he said/she said debate over the quality of AMC's programming assets, Hargreaves likes what it's got in The Walking Dead ("the biggest show on TV") as well as Better Call Saul and the promising Fear the Walking Dead. Ad revenue looks to be skewing more heavily to top content, he says, threatening other companies with "broader bases of good (but not great) content."
- His price target for AMCX is unchanged at $85 (7% implied upside from current).
Nov. 5, 2015, 10:56 AM
- AMC Networks (NASDAQ:AMCX) is up 2.7%, riding high after a Q3 beat paced by 31% revenue gains in the U.S.
- Net income from continuing operations was $73M vs. a year-ago $54M.
- Revenue breakout: National networks, $521.6M (up 31.3%); International/other, $114.1M (down 7%).
- For national networks (AMC, WE tv, BBC America, IFC and SundanceTV) ad revenues were up 52.3%, to $210M. Distribution revenues were up 20.1% to $311M. Internationally, currency fluctuations dampened results.
- IFC Films also declined against a bad comp (the theatrical release of Boyhood in the prior year).
- Adjusted operating cash flow was up 34.3%, to $191M.
- Conference call at 11 a.m. ET.
Nov. 4, 2015, 11:16 AM
- Cable TV networks are sinking in reaction to sharply lowered guidance from Time Warner (NYSE:TWX), which is using its conference call to lower expectations for ratings and subscribers in 2016.
- Disney (NYSE:DIS) was positive earlier but has tumbled 2.6%; Twenty-First Century Fox is off (FOX -4.6%, FOXA -4.9%); Viacom has sunk (VIA -5.2%, VIAB -6.2%); Discovery Communications as well (DISCA -4.3%).
- AMC Networks (NASDAQ:AMCX) is off 3.5% and Starz (NASDAQ:STRZA) down 2.1%.
- Time Warner is now -10% in reaction to its conference call, still ongoing.
- Previously: Time Warner dives 7.9%, cutting 2016 outlook on call (Nov. 04 2015)
- Previously: Time Warner -0.7% early after Q3 beats on strength at HBO, Warner Bros. (Nov. 04 2015)
Oct. 20, 2015, 7:15 PM
- Baseball's being very good to Turner (TWX +0.8%), as TBS rode the playoffs to a win in cable ratings last week.
- The network averaged 4.6M viewers in prime-time, largely due to a network-record pace for postseason baseball ratings, which are averaging 5.9M viewers.
- It beat ESPN (DIS; 3.2M) and sibling net CNN, which hit a 2.2M average on the strength of a Democratic debate that drew more than 15M.
- TBS also pulled a rare win on a 24-hour basis -- the usual province of children's programming like Nick and the Disney Channel -- and also among the 18-49 demographic.
- Its Saturday broadcast of game 1 of the NLCS (Mets-Cubs) was the sixth-most watched program of the week, behind the Democratic debate (and its pre-show and post-show), The Walking Dead on AMC (AMCX -6.3%), and Oct. 12's Monday Night Football (Pittsburgh-San Diego).
AMC Networks, Inc. is a holding company that owns and operates cable television networks through its subsidiaries. The company operates its business through two segments: National Networks and International & Other. The National Networks segment principally includes four nationally distributed... More
Industry: Entertainment - Diversified
Country: United States