In a report published Wednesday, Morgan Stanley analyst Benjamin Swinburne reiterated an Underweight rating on Scripps Networks Interactive (NYSE: SNI), and raised the price target from $78.00 to $82.00.
In the report, Morgan Stanley noted, “Our UW thesis is unchanged, although we note shares have lagged the group ~2,100bp since YE12. Our view is that key industry growth drivers – domestic affiliate renewals, int'l distribution gains, balance sheet optimization – are not likely factors for SNI in '14. While SNI has taken measures to suggest a more aggressive approach to capital returns, and valuation is less challenging (relative to group EV / EBITDA multiple has compressed 0.5x since Jan '13), high exposure to advertising (70% of revs) may present some risk to estimates with live ratings under pressure across TV and an ad market that has underwhelmed.”
Scripps Networks Interactive closed on Tuesday at $80.27.
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