Starz Is A Hold Until It Acquires More Mass
Summary
- Starz's split from Lionsgate is not compelling at the moment as it seems to lack the brand strength and scale to compete with Netflix and Disney in streaming.
- Revenue is declining due to subscriber losses and the collapse of the linear-cable bundle model, despite some improvement in adjusted OIBDA.
- Starz must contend with deleveraging, and upcoming earnings reports will be critical to assessing its standalone prospects.
- Given these challenges, I view Starz as a hold at best, awaiting clearer signs of sustainable growth or strategic change.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of DIS, LION, NFLX, WBD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
In addition to owning long-term positions in the stocks mentioned above, I may trade around those positions in a short-term account.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.