Normally when I invest, I don’t let my emotions get involved — and that makes many of my choices extremely boring. I seek out companies in sectors where I see the most growth, while also having stellar profit margins, revenue increases and undervaluation.
So when I took a look at the financials behind Time Warner Inc (NYSE:TWX), I was extremely excited. This is a company that can not only add some stability to my currently volatile portfolio, it is also a firm that will be entertaining to follow. After all, the company is an entertainment firm, which means that if I invest in Time Warner Inc (NYSE:TWX), I would get my fair share of thrills by seeing its name associated with many of the TV programs, films and publishing operations the company owns. But that’s not why I think this stock would make a great addition to my portfolio.
What makes Time Warner Inc (NYSE:TWX) a gem?
The company is a clear buy for several reasons, including its effort to increase customers through satellite and cable TV providers. This customer base represents a key element for the company that increases the firm’s competitive position.
Time Warner Inc (NYSE:TWX) is also a leader in the “TV Everywhere” initiative, which aims to have a pay-TV subscriber network where people can access programming from multiple platforms. The firm is expected to roll this out over the next several years, and that could significantly increase its revenue.
But perhaps emotions do play a bit of a stake in my appreciation for Time Warner Inc (NYSE:TWX). The firm does own HBO, and that TV channel features some of the best entertainment around. However, when looking at the firm’s profit margin, we can see that this stellar line item sets the company apart from the others. Last year, the firm earned a 10% profit margin. And that has been consistent in each of the last three years. Not only can Time Warner Inc (NYSE:TWX) entertain the public, it can also entertain an attractive return on equity.
Disney sparks nostalgia
The company shows some definite potential. In the resorts and parks division of the firm, The Walt Disney Company (NYSE:DIS) appears to be able to increase its sales, as this sector poses a lot of potential upside due to the economic recovery.