Viacom reported fiscal Q4 2017 earnings today that were “OK versus expectations,” says Pivotal Research Group Senior Research Analyst/Advertising Brian Wieser. But, the owner of MTV, Nickelodeon and BET provided an outlook that was worse than expected.
That reset Pivotal’s price target on Viacom shares, which sank to a new five-year-low.
At the Closing Bell, Viacom’s Class B shares were down 3.7%, to $23.69.
Meanwhile, Wieser set a $27 per share price target on a calendar year-end 2017 basis. That’s a haircut from $30, as he maintains his “Hold” recommendation on Viacom’s Class B shares.
Wieser notes that the outlook was generally worse than what was previously incorporated into its model, as the impact of the Charter renewal caused a high single digit decline during the first half of the company’s fiscal 2018, with a mid-single digit decline expected for the full fiscal year ahead of expectations for growth in 2019.
Domestic advertising is expected to fall by low-single digits in calendar Q4 2017 (although offset by international gains), which represents a reversal of the September quarter’s favorable improvement.
Otherwise, it was a good day on Wall Street for the TV industry, with TEGNA, The E.W. Scripps Co., Sinclair Broadcast Group, Nexstar Media Group, and Gray Television also enjoying a jump fueled by the FCC’s Order that eliminates its 42-year-old media cross-ownership rules.
For a complete look at the activity of other media companies on Wall Street on Thursday, please view our Wall Street Report on the homepage of RBR.com.