Collins Stewart Downgrades Scripps Networks Interactive (SNI) to Hold
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Collins Stewart downgrades Scripps Networks Interactive (NYSE: SNI) to Hold.
Collins analyst says, "Given the impressive run in the stock, we believe SNI is now fairly valued at 9.5x 2010 EBITDA. This thesis is supported by several factors, including: unlikely sufficient SNI 2010 EBITDA upside; the slightly dilutive to valuation Travel Channel venture; and the fact that SNI is now not likely to be a take-out candidate...While we expect the renewal of the Food Network affiliate fee will help generate more than a 19% increase in Affiliate fee revenue, 8% increase in total revenue and a 12% increase in total EBITDA to $684mm, we estimate that the current price requires 2010 EBITDA of $730mm or higher, which is unlikely in our view. We acknowledge that SNI has yet to report 3Q09 earnings but we do not expect significant enough improvements in fundamentals or in the network affiliate fees to warrant $735mm 2010E EBITDA."
To see more analyst ratings on SNI Click Here.
Scripps Networks Interactive, Inc. operates as a lifestyle content and interactive services company in the United States and internationally.
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