LowIQinvestor Posted January 6, 2015 Share Posted January 6, 2015 VIAB at 12 PE (2015 EPS) DISCA at 18 PE CBS at 17 PE time to buy more Link to comment Share on other sites More sharing options...
LowIQinvestor Posted January 14, 2015 Share Posted January 14, 2015 Wow, Citi downgrade really knocked this down! They site the potential for DISH to drop Viacom and only 10% chance Viacom is acquired. Very baffling downgrade. Link to comment Share on other sites More sharing options...
dwy000 Posted January 14, 2015 Share Posted January 14, 2015 Wow, Citi downgrade really knocked this down! They site the potential for DISH to drop Viacom and only 10% chance Viacom is acquired. Very baffling downgrade. Dish seems all over the place. They get into a battle with CBS that pulls the channels for a while. They drop FOX - still off the air. Now they may drop Viacom? And on top of that they start up this Sling TV OTT service. Low priced, minimal content for people who already have a separate internet connection. That strikes at the heart of Dish's customer base. Link to comment Share on other sites More sharing options...
merkhet Posted January 14, 2015 Share Posted January 14, 2015 Ergen is crazy like a fox. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted January 14, 2015 Share Posted January 14, 2015 Whoops :) "Viacom's (VIAB) carriage deal with DISH is not up for renewal in 2015, says a company spokesman. Citi--which downgraded VIAB to sell from buy this morning while putting a 50% probability on DISH dropping VIAB offerings like MTV, Nickelodeon and Comedy Central--said the carriage renewal was "likely slated for 2015." Link to comment Share on other sites More sharing options...
RadMan24 Posted January 15, 2015 Share Posted January 15, 2015 It's been popping up on the magic formula screen, despite having a market cap minimum of 50 million and 30 stocks. Its got to be a hidden cash cash, high return on capital and cheap on an enterprise business basis. It's worth looking into. I got the 10K in tonight, I'll share some thoughts later on this week if something sticks out. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted January 19, 2015 Share Posted January 19, 2015 Stifel Upgrades Viacom On Positive Growth Outlook: In a report published Friday, Stifel analyst Benjamin Mogil upgraded the rating on Viacom, Inc. (NASDAQ: VIAB) from Hold to Buy, and named an $89.00 price target. http://finance.yahoo.com/news/stifel-upgrades-viacom-positive-growth-135611994.html Quite the disparity between Citi and Sifel ($62 target for Citi & $89 for Stifel) Link to comment Share on other sites More sharing options...
LowIQinvestor Posted January 20, 2015 Share Posted January 20, 2015 Really hope Viacom is buying back shares here: 10 PE for a company that has around a 50% ROE and strong media brands seems like a good bet. Link to comment Share on other sites More sharing options...
dwy000 Posted January 20, 2015 Share Posted January 20, 2015 Really hope Viacom is buying back shares here: 10 PE for a company that has around a 50% ROE and strong media brands seems like a good bet. I think they telegraphed the plan to buyback $1bn+ (the back of my mind says $1.3bn) on their year end call. At a fixed $ amount and today's prices, the # of share being acquired is just going higher and higher. Link to comment Share on other sites More sharing options...
dwy000 Posted January 20, 2015 Share Posted January 20, 2015 I underestimated! The number they have for stock buybacks in 2015 is $2.5bn. At $65, that's 38M shares. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted January 21, 2015 Share Posted January 21, 2015 Viacom’s Fortress of Fortitude Investors Shouldn’t Overlook the Company’s Key Strengths http://www.wsj.com/articles/viacoms-fortress-of-fortitude-heard-on-the-street-1421769495?ru=yahoo?mod=yahoo_itp DISCA is starting to pop up on my radar as well. Link to comment Share on other sites More sharing options...
Gray Fox Posted February 11, 2015 Share Posted February 11, 2015 I'm surprised the stock isn't down more on the Jon Stewart announcement. Comedy Central had three key levers for a long time, South Park, the Daily Show, and the Colbert report. They've lost two of those now. The big winner is probably Daniel Tosh. He can ask for more money to stay. I'm guessing NFLX would be willing to offer a boatload of cash to the South park guys. They can do a new episode in a day or two and the ability to stream the past episodes would be huge. Comedy Central is a much weaker property and VIAB is going to have a lot less leverage in negotiating with MVPDs. I think there is a real possibility they get dropped by Dish in the next few years. Link to comment Share on other sites More sharing options...
RadMan24 Posted February 12, 2015 Share Posted February 12, 2015 I'm surprised the stock isn't down more on the Jon Stewart announcement. Comedy Central had three key levers for a long time, South Park, the Daily Show, and the Colbert report. They've lost two of those now. The big winner is probably Daniel Tosh. He can ask for more money to stay. I'm guessing NFLX would be willing to offer a boatload of cash to the South park guys. They can do a new episode in a day or two and the ability to stream the past episodes would be huge. Comedy Central is a much weaker property and VIAB is going to have a lot less leverage in negotiating with MVPDs. I think there is a real possibility they get dropped by Dish in the next few years. That's only a hour worth of shows...The rest of comedy central has great shows and doing very well. Don't think I'm too concerned. If I didn't have a restriction at work, I'd be buying it. Link to comment Share on other sites More sharing options...
valuedontlie Posted March 11, 2015 Share Posted March 11, 2015 At DB conference presentation CEO mentioned $250m in net annualized cost savings beginning in 2H15 after realigning networks. Seems pretty significant, especially if business trends unchanged. Link to comment Share on other sites More sharing options...
silverhawk Posted March 11, 2015 Share Posted March 11, 2015 Sentiment is negative around this name because the company doesn't have sports networks and analysts think that niche networks will be the first to go in the bundle. The company's revenue growth has been anemic and people question management's institutional ability to create new hit content, svod strategy and the wisdom of buying back stock versus spending to grow organically or through M&A. On a PE basis, looks like a slam dunk paying 12x earnings for a highly profitable but slower growth franchise. On an EBITDA basis, looks decent but not great because of a lack of revenue growth and margin expansion as well as the large $11bn in debt the company has. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted March 13, 2015 Share Posted March 13, 2015 I think VIAB trades around 10x 2016 earnings. DISCA trades around 16 x 2016 earnings CBS trades around 14x 2016 earnings. Link to comment Share on other sites More sharing options...
valuedontlie Posted March 13, 2015 Share Posted March 13, 2015 The current situation reminds me of AZO in 2008-2009. It was trading around 10-12x earnings and habitually buying back stock (one of the few companies to increase buybacks through the downturn). If VIAB can turn some organic earnings growth then this is extremely cheap. Link to comment Share on other sites More sharing options...
Picasso Posted March 13, 2015 Share Posted March 13, 2015 The current situation reminds me of AZO in 2008-2009. It was trading around 10-12x earnings and habitually buying back stock (one of the few companies to increase buybacks through the downturn). If VIAB can turn some organic earnings growth then this is extremely cheap. Are there not a lot of other cheap stocks buying back tons of stock in the market these days? IBM, DE, OUTR, the list goes on. The AZO situation was a lot more unique than just buying back a ton of shares. Link to comment Share on other sites More sharing options...
silverhawk Posted March 13, 2015 Share Posted March 13, 2015 Yeah, I have viacom and cbs at those multiples you mentioned for 2016. If you like the cable network/retransmission story, you should check out fox which has very well positioned cable networks and a broadcast channel and stations (CFO claimed spectrum on a comps basis was worth $9bn recently). Fox is very likely to have good organic growth both in the US and internationally and is buying back $6bn in stock. I'm not familiar with autozone but I think the key difference is that the cable business model may be under severe threat and we are probably later rather than earlier in the economic cycle. Company has been borrowing to buy back stock and so has been replacing equity with debt. The company is turning in organic earnings growth via affiliate and svod licensing fees but advertising is likely to be hit by diminished ratings in core networks and lower cpms. Link to comment Share on other sites More sharing options...
dwy000 Posted March 13, 2015 Share Posted March 13, 2015 I think VIAB trades around 10x 2016 earnings. DISCA trades around 16 x 2016 earnings CBS trades around 14x 2016 earnings. DISCA has much better international exposure/growth and therefore less reliant on the shifting sands of US cable tv. CBS has retrans as well some sports. So both of those probably deserve a premium on VIAB but the whole sector is pretty beaten down. Link to comment Share on other sites More sharing options...
RadMan24 Posted March 14, 2015 Share Posted March 14, 2015 I think VIAB trades around 10x 2016 earnings. DISCA trades around 16 x 2016 earnings CBS trades around 14x 2016 earnings. DISCA has much better international exposure/growth and therefore less reliant on the shifting sands of US cable tv. CBS has retrans as well some sports. So both of those probably deserve a premium on VIAB but the whole sector is pretty beaten down. DISCA may have better international exposure/growth, but that is not a moat or competitive advantage. It is just a small point of the whole overall story. US cable tv is shifting, but VIAB is not standing still because they have content people want to see. ComedyCentral.com for instance and its mobile app direclty link consumers to their shows, adding another source of revenue through ads, which have not been fully monetized yet. Facebook had a similar worry about how it would monetize mobile. Once the cable industry, or the content players, figure out how to monetize the digital world, then earnings/revenue will rebound. That's the problem right? How do these companies still provide content and are able to monetize and maintain pricing power. The market is uncertain how well they will do; however, the risk of them failing is very low. In my opinion. Link to comment Share on other sites More sharing options...
silverhawk Posted March 15, 2015 Share Posted March 15, 2015 DISCA may have better international exposure/growth, but that is not a moat or competitive advantage. It is just a small point of the whole overall story. US cable tv is shifting, but VIAB is not standing still because they have content people want to see. ComedyCentral.com for instance and its mobile app direclty link consumers to their shows, adding another source of revenue through ads, which have not been fully monetized yet. Facebook had a similar worry about how it would monetize mobile. Once the cable industry, or the content players, figure out how to monetize the digital world, then earnings/revenue will rebound. That's the problem right? How do these companies still provide content and are able to monetize and maintain pricing power. The market is uncertain how well they will do; however, the risk of them failing is very low. In my opinion. I would argue that having international distribution is a major competitive advantage. If you can take your existing programming in the US or remake it to cater to local tastes, it provides a high degree of both financial and creative operational leverage and makes your brand global and more valuable. Although it is of lesser importance today, being in the bundle of channels offered and having a good location in terms of channel placement creates a virtuous cycle in terms of entrenchment in a particular country's pay-tv ecosystem and partially helps crowd out potential competitors. Viacom is poorly positioned and its ratings are down dramatically. The company has been using its cash flow to buy back stock and pay dividends instead of allocating capital to acquisitions of youtube channels or ad tech companies or heavily investing in new original content or rapid international growth efforts. Things are likely to get worse for Viacom in the future if users migrate to less profitable distribution platforms and the company trades "analog dollars for digital dimes". If a true a la carte environment takes hold in the US, it is reasonable to assume that many people will drop programming such as VH1 and BET. TV is no longer the only game in town if you want to make large ad buys and reach large audiences. Advertising is becoming much more metric oriented and cpms are more likely or not to decrease for tv advertising which is made worse by declining ratings. The stock fully reflects the fears over the potential impact of these secular challenges. I think the bundle is too strong to be broken and despite weakness in some cable networks, the Viacom slate will continue to be held by the vast majority of tv subscribers. If I'm right, revenue and profitability with increase a bit incrementally, the multiple should expand to reflect the high degree of stability and profitability of the business and buybacks will juice returns by increasing my ownership stake in the company. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted April 1, 2015 Share Posted April 1, 2015 Yacktman's comments on Viacom from his annual report: "Viacom’s (VIA) shares were weaker in 2014, due to concerns about the advertising markets and weak ratings at some of its cable networks. Management is working hard to address the ratings issues and the company continues to generate significant amounts of free cash flow. We think Viacom sells at an attractive valuation, and management has been an aggressive repurchaser of shares, buying back nearly one-third of the outstanding shares since the beginning of 2011." Link to comment Share on other sites More sharing options...
silverhawk Posted April 6, 2015 Share Posted April 6, 2015 Viacom Plans $785 Million Charge for Restructuring. Viacom said it would temporarily pause stock buybacks under its current $20 billion program. It expects to resume repurchases by October, when its next fiscal year begins. Nothing better than suspending your share repurchase program when your stock is at 52 week lows. http://www.wsj.com/articles/viacom-announces-restructuring-1428352039?mod=WSJ_hp_LEFTTopStories Link to comment Share on other sites More sharing options...
RadMan24 Posted April 8, 2015 Share Posted April 8, 2015 Viacom Plans $785 Million Charge for Restructuring. Viacom said it would temporarily pause stock buybacks under its current $20 billion program. It expects to resume repurchases by October, when its next fiscal year begins. Nothing better than suspending your share repurchase program when your stock is at 52 week lows. http://www.wsj.com/articles/viacom-announces-restructuring-1428352039?mod=WSJ_hp_LEFTTopStories They also already bought back $1.5 billion so far this year, and hope to return repurchasing stock no later than Oct. 2015. This is to ensure they have cash on hand and leverage ratios, capital discipline, to undergo corporate restructuring, that if successful, will shed $200-$350 m a year off expenses. If you're an investor, in this case you hope that the stock continues to fall so when they resume they can buy back more when its cheaper before the cost savings and revenue growth are fully recognized by the market. The market is worried about the strong drop in ratings on all major programs this year, which is why the company is focusing on developing new avenues to distribute content to consumers and ad revenue. Link to comment Share on other sites More sharing options...
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