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cheapbag214s
Wysłany: Czw 3:59, 05 Wrz 2013
Temat postu: AMC Networks doesn't make killing in first day as
AMC Networks doesn't make killing in first day as public company
Looks like Wall Street had a similar reaction to AMC Networks Inc. first day like a public company as critics did towards the much-maligned season finale of AMC murder mystery "The Killing."
AMC Networks -- parent of cable channels AMC,
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, WE, IFC and Sundance -- closed its first day like a public company at $39.85 a share,
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, down 8.3% in the $43.50 price that shares were issued at Friday morning.
Cable programmers are usually considered hot commodities by Wall Street. However,
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, AMC Networks, that was spun off by New York-based cable operator Cablevision Systems Corp.,
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, has some warning flags,
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, according to Street analysts.
For starters,
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, unlike two other publicly owned programming companies -- Discovery Communications and Scripps Networks Interactive Inc. -- AMC Networks doesn make or own big stakes in a lot of the programming that it continues its channels. AMC biggest shows include "Mad Men" and "Breaking Bad,
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," of which are from outside studios. That,
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, wrote Barclays Capital analyst Anthony DiClemente, "places the organization in a disadvantage" when negotiating carriage handles distributors.
Furthermore,
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, DiClemente thinks that AMC and WE,
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, both biggest channels from the company, are already getting money from distributors in license fees and that the near future revenue growth will be modest.
"Based on our analysis,
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, AMC and that we are 25% above market on their affiliate fee deals,
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, while networks like HGTV,
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, Food Network,
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, Investigation Discovery and Nickelodeon are significantly below market,
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," he explained.
There is a school of thought that AMC Networks is a takeover target. The Dolan family,
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, which holds the majority of stock in Cablevision,
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, also offers the majority of voting shares in AMC Networks. While family members may be seeking to sell, their large stake should discount the stock price,
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, some analysts feel. Furthermore, the Dolans are notoriously tough negotiators and may be hard to read by Wall Street.
Few are down on AMC. While DiClemente has a target price of $32 per share,
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, BTIG analyst Rich Greenfield a study this week having a target price of $50 for AMC Networks. BTIG anticipates several potential suitors for that programmer,
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, including Comcast NBCUniversal and Time Warner. Obviously, those companies already own substantial cable programming holdings and could not feel a necessity to add four smaller networks.
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