Viacom/Dish Deal Kill The Bear Thesis - Stifel (VIAB) (DISH)

Stifel analyst, Benjamin Mogil, believes the Dish (NASDAQ: DISH)/Viacom (NASDAQ: VIAB) deal announced this morning invalidates the bear thesis of only a selective number of channels being renewed and opens the door to Paramount taking a stake in the company. No change to the Buy rating on Viacom or the $49 PT.

This morning, Viacom and DISH announced that they had reached a carriage agreement. The deal renews on traditional DTH service all 18 Viacom channels, and we believe this takes away the worst case scenario that only some of the channels would be renewed. The deal also calls for the anchor channels of Comedy Central, BET, Spike and Nick Jr to be on DISH's Sling TV product, on both the single stream and multi-stream offerings, though the tier/packaging was not noted. Nickelodeon was not noted among the Sling channels.

The deal ensures $700mn of affiliate fees and likely around $600mn of advertising (assuming that the DISH subscriber base ratings are on par with the overall MVPD universe for Viacom product). The deal certainly takes away the most major bear case on this name and likely allows the company more flexibility in its options regarding Paramount.

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 $37.38 yesterday.

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