The New York Times and Other Media Takeover Targets in 2013 (DISH, SIRI, NYT)

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Marketwatch
suggests that media stocks Dish Network
DISH
, Sirius XM Radio
SIRI
and the New York Times
NYT
are among the likely takeover candidates in the new year. Whether someone wants their spectrum, another company already effectively controls them, or they have been linked to someone with the resources and soon more time on his hands, there is plenty of reason to be optimistic about these potential marriages. Below is a quick look at the performance of these three stocks, as well as what analysts have been expecting from them. Additional takeover candidates in the Marketwatch article include Scripps Networks
SNI
and the Washington Post
WPO
.
Dish Network
Rumors have had rival DirecTV
DTV
and AT&T
T
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as possible suitors for this satellite TV provider. It has a market capitalization near $16 billion. The return on equity is a whopping 580 percent. But the long-term earnings per share (EPS) growth forecast is less than three percent, and the price-to-earnings (P/E) ratio is higher than the industry average. Still, the short interest was only about one percent of the float at the November 30 settlement date. Less than half of the 26 analysts surveyed by Thomson/First Call who follow the stock recommended buying shares, though only three of them rate it at Underperform. Their mean price target, or where they expect the shares to go, is about five percent higher than the current share price. That target is less than the recent multiyear high, though. The share price has pulled back more than six percent from that recent high, but shares still are trading more than 22 percent higher year to date. The stock has outperformed Comcast
CMCSA
, DTV and the broader markets over the past six months.
Sirius XM Radio
Liberty Media
LMCA
already owns nearly half of this satellite radio services company and has been aggressively pursuing a controlling interest. Sirius sports a market cap of more than $15 billion. Its P/E ratio is less than the industry average, and the long-term EPS growth forecast is almost 28 percent. The return on investment is about 87 percent. The short interest is more than 10 percent of the float. That is the highest number of shares sold short in a year. The consensus recommendation of the 16 analysts surveyed is to buy shares. They believe the stock still has some room for growth, as their mean price target is more than eight percent higher than the current share price. That would be a level the share price has not seen since 2008. Shares are up about 56 percent year to date and reached a multiyear high last week. The share price jumped five percent in mid-December on better-than-expected news about music royalty rates. The stock easily has outperformed the broader markets over the past six months.
New York Times
What will Michael Bloomberg, founder of the Bloomberg media empire, do next when his term as New York City mayor ends? Some see his company making a move on the venerable New York Times, which has a market cap of about $1.2 billion. The forward earnings multiple is less than the industry average P/E ratio. But the long-term EPS growth forecast is only about three percent. The return on equity is about 19 percent. The short interest is near 11 percent the float, though the average daily volume in the most recent period was the lowest it has been since July. Only two out of the 10 polled analysts recommend buying shares, but three months ago there was only one Buy recommendation. The mean price target represents nearly 10 percent potential upside, but it is less than the 52-week reached in October. The share price plunged more than 20 percent in October on a surprise net loss and revenue miss for the third quarter. Shares have risen about five percent in the past month and are up about 11 percent year to date. Despite the tumble, the stock still has outperformed the Washington Post and the broader markets over the past six months.
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Posted In: Long IdeasShort IdeasRumorsTrading IdeasAT&TBloombergComcastDIRECTVDish Networkliberty mediaMichael BloombergNew York Timesscripps networksSirius XM RadioWashington Post
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