This operator of the Discovery Communications Inc. (NASDAQ:DISCA), TLC and Animal Planet networks is capitalizing on the broadening presence of pay TV channels in Latin America, as well as the so-called “free to air” movement in Europe, which is allowing non-subscribers to view cable programming. As a result, both distribution and advertising revenues are soaring abroad.
As few earnings catalysts are currently in place domestically, Discovery Communications Inc. (NASDAQ:DISCA) is focusing its investments overseas. For instance, late last year it purchased a European sports network, in addition to five Italian TV channels. Plus, early this year it bought out an additional 30% of Discovery Communications Inc. (NASDAQ:DISCA) Japan, giving it a 50% ownership. Along with buyouts in Dubai and Latin America, it is building a greater stronghold in growth markets.
Discovery Communications Inc. (NASDAQ:DISCA) stock offers capital appreciation potential, though gains are partially priced in likely. Similar to IAC/InterActiveCorp (NASDAQ:IACI), earnings could climb more than 30% this year, and the shares would then look more enticing. Buybacks ought to help boost share net and thus shareholder returns.
Foolish wrap up
These companies incorporate many of the aspects inherent in well-performing media entities. These factors consist of growing advertising and affiliate revenue, along with investments in growing sectors of the entertainment industry. They may benefit, too, from an expanded presence in digital platforms and international units.
Of the three discussed here, my favorite at this juncture is AMC Networks, based on its robust, organically-generated earnings expansion prospects for the near term. All three would be good additions to a portfolio focused on growth.
Damon Churchwell has no position in any stocks mentioned. The Motley Fool recommends AMC Networks. Damon is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
The article Check Out These Three Media Stocks originally appeared on Fool.com is written by Damon Churchwell.
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