Media investments that pay investors.
As millions of Americans are stuck at home thanks to the coronavirus outbreak, it's safe to say that news and entertainment programming is in high demand. A lot of that information is disturbing lately -- particularly for those watching the stock market -- but the good news is that a group of dividend-paying media stocks may wind up weathering the storm thanks to this increase in viewership. Nobody knows what tomorrow will be like on Wall Street in this uncertain environment. Furthermore, dividend investing is necessarily long-term, so it may take a while for these stocks to pay back. But if you're looking for lower-risk income plays to replace riskier positions in your portfolio, consider these seven media stocks.
Comcast Corp. (ticker: CMCSA)
You may not think of telephone, internet and cable TV provider Comcast as a media company. However, CMCSA bought NBC Universal in 2013 to become a content provider, too. Now it has several years of in-house production under its belt, including both TV programming as well as feature films through its Dreamworks animation arm and even a European footprint thanks to ownership of Sky Group. The dividend isn't as big as some of the other players on this list, but the scale is certainly there with a current market capitalization of roughly $160 billion.
Current yield: 2.41%
Walt Disney Co. (DIS)
Of course, there is one big-name media stock that's even bigger -- Disney. The company admittedly does have some in-person entertainment revenue that will dry up, with its parks, experiences and products business line at roughly a third of total revenue. That segment also includes merchandising that won't be as hard hit. And with diversified media operations that span streaming on Disney Plus, TV networks like ABC and theatrical releases that are being downloaded like crazy as folks stay at home, this stock has staying power -- particularly with a very sustainable dividend on top.
Current yield: 1.88%
Interpublic Group (IPG)
Interpublic provides advertising and marketing services worldwide. That kind of media-related service is in high demand, as evidenced by the brand outreach you've assuredly seen amid the coronavirus outbreak. From CEO emails to special messages to customers, communication is key in a crisis, and IPG helps major companies get the word out in good times and bad. This crisis communications bump could offset any lost event marketing for IPG and continue to support a generous dividend.
Current yield: 6.94%
News Corp. (NWSA)
Though previously joined with the businesses of Fox Corp. (FOXA), News Corp. is not to be confused with the broadcast-focused business that it divorced from in 2013. News Corp. is now primarily a print and digital content provider through publications that include The Wall Street Journal and both The Times and The Sun in the United Kingdom. While the print business has been hurting for years, NWSA has transitioned much of its operations online. As folks remain stuck at home and starved for information about the outside world, News Corp. properties should do well -- and with a decent dividend as a hedge, investors may want to consider a long-term position in this media stock.
Current yield: 1.84%
Omnicom Group (OMC)
A similar play to IPG, Omnicom offers advertising, marketing and corporate communications services. Though all of these are important, the public relations side of Omnicom including branding, social media and content marketing are particularly vital to helping companies manage their messaging in a difficult time. The services that OMC offers in this crisis will be in high demand, and clients under long-term contracts will keep a regular stream of revenue coming in to support payouts to income investors.
Current yield: 4.37%
Sirius XM Holdings (SIRI)
Satellite radio operator Sirius made a name for itself by providing a truly nationwide network of stations. And while many folks are most familiar with SIRI stock from their cars, the company has moved heavily into podcasts and mobile apps as a way to go toe-to-toe with other streaming radio peers. The dividend is decidedly modest, but this firm has a history of being on the forefront of broadcast media and may be the most agile among the names on this list.
Current yield: 1.05%
Thomson Reuters Corp. (TRI)
Another digitally savvy media name is Thomson Reuters, a firm with roots as a newspaper wire service that has branched into financial data, specialty sciences news and legal services that allow it to look beyond the typical consumer. This business-focused outlook will serve TRI particularly well right now as firms scramble to make sense of the economy and the global health scene. This demand will keep revenue for subscription services flowing to TRI and supporting its dividend.
Current yield: 2.65%
Media stocks with dividends to watch:
-- Comcast Corp. (CMCSA)
-- Walt Disney Co. (DIS)
-- Interpublic Group (IPG)
-- News Corp. (NWSA)
-- Omnicom Group (OMC)
-- Sirius XM Holdings (SIRI)
-- Thomson Reuters Corp. (TRI)
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