Nomura Securities Maintains a 'Buy' on Viacom (VIAB); Buybacks Trump Ratings
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Price: $24.22 --0%
Rating Summary:
19 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 9 | Down: 8 | New: 13
Rating Summary:
19 Buy, 21 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 9 | Down: 8 | New: 13
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Nomura Securities maintains a 'Buy' on Viacom (NASDAQ: VIAB) price target raised $1 to $54.
Analyst, Michael Nathanson, said, "Following the advertising miss in F1Q, we are decreasing our advertising projections for Viacom through the rest of the fiscal year. We now project ad revenues to be flat Y/Y in FY12, a deceleration of almost 1,000bps from FY11. We project U.S. advertising to grow by 1.5% in F2Q, flat in F3Q and 2% in F4Q. We are increasing FY12E affiliate fee growth to 9% (from 8%) with an additional digital deal in FY12. We reduce our Cable Network EBIT growth to +4% (from +6%) due to our lower ad revenue. Our FY12 Studio EBIT estimate of $288mn is unchanged. As a result, we are reducing our FY12E EPS by $0.02 to $4.30. Although there are realistic concerns about the pace of ad growth and ratings in the coming quarters, we believe that many investors are taking a longer-term view that Viacom is simply too cash-generative, too cheap and too resilient to trade below these levels vs. peers. We rate Viacom Buy with a new target of $54 based on the higher market multiple."
For an analyst ratings summary and ratings history on Viacom click here. For more ratings news on Viacom click here.
Shares of Viacom closed at $46.69 yesterday.
Analyst, Michael Nathanson, said, "Following the advertising miss in F1Q, we are decreasing our advertising projections for Viacom through the rest of the fiscal year. We now project ad revenues to be flat Y/Y in FY12, a deceleration of almost 1,000bps from FY11. We project U.S. advertising to grow by 1.5% in F2Q, flat in F3Q and 2% in F4Q. We are increasing FY12E affiliate fee growth to 9% (from 8%) with an additional digital deal in FY12. We reduce our Cable Network EBIT growth to +4% (from +6%) due to our lower ad revenue. Our FY12 Studio EBIT estimate of $288mn is unchanged. As a result, we are reducing our FY12E EPS by $0.02 to $4.30. Although there are realistic concerns about the pace of ad growth and ratings in the coming quarters, we believe that many investors are taking a longer-term view that Viacom is simply too cash-generative, too cheap and too resilient to trade below these levels vs. peers. We rate Viacom Buy with a new target of $54 based on the higher market multiple."
For an analyst ratings summary and ratings history on Viacom click here. For more ratings news on Viacom click here.
Shares of Viacom closed at $46.69 yesterday.
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