CBS (CBS) Viacom (VIAB) Needs Move Quickly To Gain A Foothold Against Amazon, Disney and Comcast

Needham & Company analyst Laura Martin reiterated a Buy rating and $60.00 price target on CBS (NYSE: CBS) but cut her 2Q19 EPS estimate by 8% to $1.11 while acknowledging that there is valuation upside for the combined CBS/Viacom from faster EPS growth, a stronger balance sheet, and a better strategic position owing to larger scale.

The analyst notes that there are risks to the transaction and believes the biggest is time. She stated "The biggest negative (our view) of CBS + VIAB is that it pushes off the necessary next-step of consolidation by 3-4 years, which adds risks owing to the rapidly accelerating competitive landscape. We believe the combined company will find it difficult to compete with the new giants in video".

For an analyst ratings summary and ratings history on CBS click here. For more ratings news on CBS click here.

Shares of CBS closed at $53.18 yesterday.

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