UPDATE: Bank of America Downgrades Viacom to Underperform, Lowers PT as Headwinds Return

In a report published Thursday, Bank of America analyst Jessica Reif Cohen downgraded the rating on

from Neutral to Underperform, and lowered the price target from $91.00 to $72.50. In the report, Bank of America noted, “We project VIA's F4Q14E will largely reflect the ongoing fundamentals of the global Pay TV and Film businesses, albeit with increasing headwinds from persistently anemic ratings (co. specific). All-in, we project VIA rev. growth of +7% Y/Y (vs. +7% prev.) and sluggish EBIT (-1% vs. +5% prev.), driven by: (1) a decline in global adv. growth (-3% vs. +2% prev.), (2) an SVOD-driven uptick in global affil. fee growth (+18% vs. +13% prev.), (3) modest margin compression at Cable Networks and (4) a decline in Film profitability. Due to the above and a lower tax rate, our F4QE EPS declines to $1.66 (vs. $1.74 prev.). We project $850mn in buybacks during the Q.” Viacom closed on Wednesday at $68.20.