Market Overview

Discovery Communications Shares Finally Trading In Line With Growth; Loop Drops From Buy To Hold

Share:
Discovery Communications Shares Finally Trading In Line With Growth; Loop Drops From Buy To Hold

Loop Capital has downgraded Discovery Communications Inc. (NASDAQ: DISCA) to Hold from Buy, saying the stock now prices in the growth prospects and potential dividend effects. The stock is trading a mere 4.7 percent shy of its target of $31.00.

“While it has not happened yet, we also believe the stock price today reflects the creation of a modest $0.30/sh dividend,” analyst David Miller wrote in a note.

Miller also noted that investors are undervaluing Discovery’s scale and scope within the international business as it reaches over 883 million households in 178 countries.

As of fourth quarter, Discovery’s International Networks accounts for 46.8 percent of revenues and 35 percent of adjusted EBITDA, making it the most “international” media company amongst all large-cap peers.

Related Link: What is a Best of Breed Stock?

Miller also expects Discovery to initiate a dividend of $0.30 a share, given the slowing growth rate, an improvement in 2016 free cash flow (FCF) of 9.5 percent and $1.36 billion plus in FCF expected in 2017.

At last check, shares of Discovery fell 1.01 percent to $29.32.

Image Credit: By John from Live in DC, Work in Baltimore - discovery, CC BY 2.0, via Wikimedia Commons

Latest Ratings for DISCA

DateFirmActionFromTo
Sep 2020JP MorganDowngradesOverweightNeutral
Aug 2020CitigroupMaintainsBuy
Aug 2020MKM PartnersMaintainsBuy

View More Analyst Ratings for DISCA
View the Latest Analyst Ratings

 

Related Articles (DISCA)

View Comments and Join the Discussion!

Posted-In: Analyst Color News Downgrades Price Target Analyst Ratings Movers Tech Media Best of Benzinga

Latest Ratings

StockFirmActionPT
SQNeedhamMaintains250.0
SAGEMorgan StanleyMaintains83.0
PVHMorgan StanleyMaintains90.0
BATRKMorgan StanleyMaintains26.0
ZMMorgan StanleyMaintains380.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com