Discovery Communications (DISCA) PT, Est. Trimmed at Nomura Post Q1

Nomura Securities analyst Anthony DiClemente trimmed his price target on Discovery Communications (NASDAQ: DISCA) to $95.00 (from $100.00) but maintained a Buy rating following Q1 results.

DiClemente comments, "International Ad Growth Remains Fast N’ Loud. DISCA’s 1Q results were mixed for the U.S. Networks business. Similar to its Media peers that have reported to-date, DISCA’s U.S. ad growth was modestly below our expectations, translating to a slightly lighter-than-expected U.S. adjusted OIBDA. However, international revenue was well ahead of our estimates, driven by ad growth. While international margins were lower than expected, this was primarily due to seasonality and therefore did not affect FY guidance, as Discovery reaffirmed its FY outlook across the board. However, based on the lower-than-expected 1Q OIBDA results and modest international margin compression owing to the upcoming consolidation of Eurosport, we are tweaking down our previously aggressive 2014/2015E OIBDA outlook. While we maintain our target multiple of 12x 2015 EV/EBITDA, we are lowering our target price to $95 from $100 owing to our modestly lower estimates."

The firm lowered FY14E EPS from $3.69 to $3.59; FY15E EPS from $4.53 to $4.43

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

Shares of Discovery Communications closed at $74.71 yesterday.

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