Analyst Taking A Cautious Stance On Media & Entertainment Into '16; Offers Favorite Ideas

Analysts are taking a cautious stance into 2016 with media and entertainment stocks. Eric Handler, Managing Director at MKM Partners, shared his firms views in a research note that included some of their most favorite ideas on Wednesday. "We see video games as the most attractive industry segment for 2016 within our Media & Entertainment coverage as a result of strong game lineups and positive secular tailwinds with digital revenue streams, which should produce accelerating revenue and EPS growth," the firm commented. MKM Partners sees Electronic Arts Inc.

to Outperform and as their "best idea." Other stocks that the firm "likes" include Activision Blizzard, Inc.

and Take-Two Interactive Software, Inc.

. The firms most attractive investment ideas noted were IMAX Corporation (USA)

, AMC Entertainment Holdings Inc

, and Time Warner Inc

. MKM partners sees share price performance as diverging in 2016. MKM Partners Chief Economist Michael Darda's belief is that America's economy is operating at a sub 2 percent real GDP growth level. Darda also believes that the U.S. is in its latter stages of an aging business cycle. Additionally, MKM Partners believes consumer confidence is looking good. "As a result, we believe companies best positioned to outperform this year are those in the midst of positive content cycles; and operating in more economically resistant segments, particularly video games, for which we have a very bullish outlook," the firm noted.