UPDATE: Goldman Sachs Downgrades Discovery Communications to Sell on Ratings, Euro Exposure and Ad Growth

Goldman Sachs reduced its rating on Discovery Communications

from Neutral to Sell and lowered its price target from $51 to $46. Goldman Sachs noted, "In our view, estimates and the multiple will contract on weak ratings, peer-high euro exposure, and competition from the Olympics. Our revised 2012E EPS is 4% below consensus (6% below in 2H12). DISCA shares are up over 25% year to date (vs. large cap peers +15%), with 85% of the appreciation due to multiple expansion. While recent digital deals drove higher than expected earnings, we don't think DISCA should trade at a historic average P/E given the headwinds that we see leading to more peer-like growth." Discovery Communications closed at $50.24 on Thursday.