Stifel Reviews AMC's Earnings

In a report published Tuesday, Stifel analysts maintained a Buy rating on

, while raising the price target from $82 to $89. AMC Networks reported robust 1Q15 results with better-than-expected affiliate fee growth. Regarding SVOD, both

and

are likely to have bid aggressively. However, Hulu's attractiveness as a partner is "more than price," the analysts said, while adding, "We suspect that Hulu's ability to be flexible on stacking rights (i.e., allowing the MVPDs to have full in-season VOD rights), positive for AMC heading into affiliate renewals, was a key differentiator between the SVOD platforms." Higher affiliate fee growth is expected to continue driving the company's performance for the year. "This current quarter, will likely be the softest of the year as the company's original programming slate, when viewed year over year is the softest and International has the headwinds of foreign exchange. Growth is anticipated to accelerate on the back of a stronger 2H15 slate with "Fear The Walking Dead" as the primary driver incrementally," the analysts added. The EPS estimates for FY15 and FY16 have been raised from $4.99 to $5.02 and from $5.56 to $5.68, respectively.