The media company and its stock are clear winners in an improving economy that's rekindled consumer

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Up nearly 28% so far this year, Scripps shares (ticker: SNI) have handily outperformed the stellar returns cheap disneyland tickets anaheim of the S P 500. It's been delivering financial results that routinely eclipse the expectations of Wall Street: In three of the past four quarters, Scripps has exceeded forecasts. For the latest quarter ended June 30, the Knoxville, Tenn.-based company posted net income of $160 million, or $1.08 a share, on revenue that rose 11% to $665 million. That compares with net income cheap disneyland tickets anaheim of $142 million, or 93 cents a share, in the year-earlier period on revenue of $601 million. Street analysts were anticipating net income of $1.05 a share.
The media company and its stock are clear winners in an improving economy that's rekindled consumer desires. Scripps' popular flagship HGTV, which focuses on home sales and renovations, posted a 13% gain in revenue on record levels of viewership, while revenue at the Travel Channel rose 14%. Only the Food Network lagged, cheap disneyland tickets anaheim with revenue cheap disneyland tickets anaheim up a mere 2.8%.
For the second year running, Scripps led all cable networks in "upfronts," ad commitments made in advance of a new season. Scripps, which owns most of its content, booked more than $1 billion this year and last. The spot ad market is strong, too, with prices up by mid- to high-single digits year over year. Affiliate fees rose 11%.
The growing cheap disneyland tickets anaheim ad sales and affiliate appeal are a testament to Scripps' powerful cheap disneyland tickets anaheim brands and strong lineup of shows–including House Hunters International , Love It or List It , and Cutthroat Kitchen –featuring personal stories about living abroad, renovating a home, and cooking. cheap disneyland tickets anaheim The programs attract a demographic group that advertisers love, affluent and aspirational women. cheap disneyland tickets anaheim Scripps now sees full-year 2013 revenue cheap disneyland tickets anaheim up 9% to 10%, to $2.54 billion, from a previous 7% to 9%, because of the strong advertising climate.
cheap disneyland tickets anaheim "We believe it has an undervalued and underappreciated franchise," says Amy Yong, an analyst at Macquarie Research, who has a price target of $85 a share, about 15% higher, based on a multiple of 20 times her 2014 earnings estimate of $4.24 a share. The shares now trade under 18 times consensus 2014 estimates of $598 million, or $4.20 a share. Discovery Communications
(TRBAA), that could add 15% to Scripps' earnings. Such a deal makes more sense now since Tribune, which is planning to spin off its publishing assets and transform itself into a television broadcasting company, could use the cash that it would bring. In July, Tribune agreed to pay $2.7 billion for 19 local TV stations across the U.S. Scripps is the only logical buyer of the Tribune stake, though it has said it won't overpay.
Scripps could get a lift from a continued turnaround at its Travel Channel, which is regaining traction after Anthony Bourdain, host of the popular No Reservations program, left for CNN last fall. Ratings could also improve at the Food Network, which faces tougher competition.
EXPANSION OVERSEAS IS a strategic priority, opening up new markets for distribution and advertising and supporting double-digit growth in cash flows, another potential catalyst for a higher stock price. Scripps, led by Chief Executive Kenneth Lowe, who created HGTV, has set a long-term goal of generating 10%-15% of cash flow from abroad. Lowe was not available for comment. This year, Scripps has acquired the Singapore's Asian Food Channel, the leading food-focused cable network in the region, after buying the U.K.-based Travel Channel International last year.
Added inducements for investors include the financial wherewithal for more share repurchases (it still has $650 million left under a $1 billion authorization), more acquisitions, and a higher cheap disneyland tickets anaheim dividend (the yield is less than 1%). Scripps is considered underleveraged, with its net debt at one times Ebitda compared with multiples of 2.5 and three times at other major media companies.
Echoing Yong's bullish views is James Tarkenton, a co-portfolio manager at Lateef Investment Management in Greenbrae, Calif. He has a $90 stock price target, using a multiple of 12 times 2014's enterprise value/Ebitda, or earnings before interest, taxes, depreciation, and amortization. Media companies typically trade at 14-15 times while Scripps is now valued at 10 times 2014 EV/Ebitda.
The question for Barry Lucas, cheap disneyland tickets anaheim a media analyst at Gabelli who puts a private-market value of $98-$100 on Scripps, is, "Why is it still public?" Since being spun out of E.W. Scripps in 2008, Scripps Networks, cheap disneyland tickets anaheim its original content, and its attractive viewer base have been seen as a tempting target for a bigger media company. With a market value of $11 billion, it could easily be digested by, say, Walt Disney
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Invesco's Balanced-Risk Allocation fund is atypical in almost every way possible—just for starters, it doesn't invest directly in any securities, instead using derivatives to get at the return of various asset classes. Though manager Scott Wolle insists it's a core holding, most investors are better off thinking of it as an interesting hedge for the rest of their portfolio.
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This is a great article. I have examined (carefully) their 10Q and I have some real problems with two entries. First, on the asset side. "Leased or to be leased" (what does that mean), that entry has grown to well over a billion.
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