Brean Capital Considers Possible Effects of Comcast/Time Warner Deal on Rentrak Corporation

In a report published Thursday, Brean Capital analyst Todd Mitchell reiterated a Buy rating and $74.00 price target on

. In the report, Brean Capital noted, “The investment case for Rentrak lies in its ability to displace Nielsen (NLSN, $45.41, not rated) as a currency for pricing TV advertising. The basis for this thesis lies in the increased efficacy of Rentrak's census-based measurement of increasingly fragmented linear viewership vis-à-vis Nielsen's sample approach, and in its ability to measure random access on-demand viewership, which Nielsen cannot do. We see a Comcast-TWC tie-up as accelerating the transition to a random access TVE service profile, and with it the rationale for Rentrak's approach. Moreover, with both content and distribution assets, we see Comcast as a key driver for the shift of advertising from linear to on-demand content, and believe a Comcast-TWC tie-up likely enhances this dynamic. Rentrak is uniquely positioned to measure on-demand viewership, having already aggregated the measurement of nearly every on-demand household in North America, and increasingly aggregating over-the-top (OTT) viewership data. We believe Rentrak has a constructive relationship with Comcast and its NBCU assets, as well as with Comcast Spotlight, its regional add selling group, on this front, and we think a Comcast-TWC tie-up increases the likelihood and accelerates the timeframe for Rentrak becoming a currency in on-demand. We estimate this could translate into a $200-to-$300 million opportunity for Rentrak which is not currently in our existing forecast for the company.” Rentrak Corporation closed on Wednesday at $64.21.