Netflix (NFLX), AMC Networks (AMCX) & Time Warner (TWX) Viewed as Favorite Media Names at Pacific Crest

Pacific Crest maintained Overweight rating on Netflix (NASDAQ: NFLX), AMC Networks (NASDAQ: AMCX), and Time Warner (NYSE: TWX). Analyst Andy Hargreaves called the three stocks his favorite media names given secular challenges highlighted at other media companies.

"Fear of MVPD subscriber losses and weak ad sales drove a re-rating of the media sector in Q2. We expect the secular threats driving this to persist, which is likely to prevent a rebound in multiples in the sector. Consequently, we recommend owning stocks of companies with unique EPS growth drivers such as AMCX and TWX, and also continue to highlight NFLX as the secular leader," said Hargreaves.

"Skinny bundles do not appear to be gaining material traction, which suggests consumers want a better experience, not less content," continued the analyst.

On Netflix Hargreaves said, "Strong secular leadership position. Best positioned to dominate distribution of all long-form content over the internet. Netflix is the best in the world at delivering on-demand TV, which should allow it to gain share of viewing hours and programming profits on a global basis."

On AMCX, the analyst said, "Pure-play in scripted original dramas. Expanding original programming lineup and international expansion provide potential upside to numbers," and on TWX he said, "Live sports content leading to favorable affiliate renewals, combined with cost controls, should lead to strong EPS growth. HBO Now provides incremental opportunity to grow brand awareness, negotiate better terms in linear distribution and gain subscribers."

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

Shares of Netflix closed at $125.36 yesterday.

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