Discovery (NASDAQ:DISCA) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a note issued to investors on Wednesday.
According to Zacks, “Discovery’s first-quarter 2018 results were mixed. The increase in revenues were driven by higher distribution and advertising revenues. However, declining OIBDA hurt bottom-line Discovery's buyout of Scripps is positive for the company as its product portfolio has widened significantly. Also, this buyout will help the company strengthen its foothold internationally. Going ahead, the transaction is expected to be accretive to the combined entity’s adjusted earnings and free cash flow in the very first year following closure. We are also encouraged by Discovery's joint venture with TEN for automotive media. In addition, growth in advertising and distribution revenues bode well for the company. However, loss of domestic subscribers remains a major concern. High costs and escalated debt levels represent further challenges. Shares of Discovery have underperformed the industry on a year-to-date basis.”
DISCA has been the subject of several other research reports. Barrington Research reaffirmed a “buy” rating and issued a $30.00 price target on shares of Discovery in a report on Tuesday, April 17th. JPMorgan Chase raised Discovery from a “neutral” rating to an “overweight” rating and increased their price target for the company from $26.77 to $29.00 in a report on Thursday, May 3rd. ValuEngine cut Discovery from a “hold” rating to a “sell” rating in a report on Monday, April 2nd. BidaskClub raised Discovery from a “hold” rating to a “buy” rating in a report on Tuesday, January 23rd. Finally, Barclays raised Discovery from an “underweight” rating to an “equal weight” rating and increased their price target for the company from $18.00 to $23.00 in a report on Monday, March 12th. Two investment analysts have rated the stock with a sell rating, fourteen have issued a hold rating and nine have assigned a buy rating to the stock. The stock presently has an average rating of “Hold” and a consensus target price of $25.81.
Shares of Discovery stock opened at $23.16 on Wednesday. Discovery has a 12 month low of $15.99 and a 12 month high of $27.92. The company has a market cap of $11.82 billion, a price-to-earnings ratio of 10.34, a PEG ratio of 0.56 and a beta of 1.52. The company has a quick ratio of 1.83, a current ratio of 1.83 and a debt-to-equity ratio of 2.00.
Discovery (NASDAQ:DISCA) last announced its earnings results on Tuesday, May 8th. The company reported $0.53 EPS for the quarter, beating analysts’ consensus estimates of $0.45 by $0.08. Discovery had a positive return on equity of 19.34% and a negative net margin of 7.40%. The business had revenue of $2.31 billion during the quarter, compared to analysts’ expectations of $2.24 billion. During the same quarter in the prior year, the firm earned $0.41 earnings per share. The business’s revenue was up 43.0% compared to the same quarter last year. equities research analysts anticipate that Discovery will post 2.77 EPS for the current fiscal year.
In other news, insider David Leavy sold 20,673 shares of the stock in a transaction on Thursday, March 1st. The stock was sold at an average price of $23.41, for a total value of $483,954.93. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, Director J David Wargo acquired 50,000 shares of Discovery stock in a transaction dated Wednesday, May 9th. The stock was bought at an average price of $21.37 per share, for a total transaction of $1,068,500.00. Following the completion of the purchase, the director now owns 317,591 shares of the company’s stock, valued at approximately $6,786,919.67. The disclosure for this purchase can be found here. Over the last 90 days, insiders have sold 39,482 shares of company stock valued at $913,006. Company insiders own 6.73% of the company’s stock.
Several hedge funds and other institutional investors have recently made changes to their positions in the company. Summit Trail Advisors LLC raised its stake in shares of Discovery by 26.3% in the first quarter. Summit Trail Advisors LLC now owns 20,647 shares of the company’s stock valued at $311,000 after acquiring an additional 4,299 shares in the last quarter. CIBC World Markets Inc. raised its stake in Discovery by 689.4% in the first quarter. CIBC World Markets Inc. now owns 214,194 shares of the company’s stock valued at $4,590,000 after buying an additional 187,061 shares in the last quarter. Royal Bank of Canada raised its stake in Discovery by 8.6% in the first quarter. Royal Bank of Canada now owns 261,979 shares of the company’s stock valued at $5,613,000 after buying an additional 20,786 shares in the last quarter. Her Majesty the Queen in Right of the Province of Alberta as represented by Alberta Investment Management Corp raised its stake in Discovery by 11.6% in the first quarter. Her Majesty the Queen in Right of the Province of Alberta as represented by Alberta Investment Management Corp now owns 352,500 shares of the company’s stock valued at $7,554,000 after buying an additional 36,600 shares in the last quarter. Finally, Millennium Management LLC acquired a new stake in Discovery in the first quarter valued at $44,747,000. Institutional investors and hedge funds own 51.88% of the company’s stock.
Discovery Company Profile
Discovery, Inc operates as a media company worldwide. The company operates through U.S. Networks, International Networks, and Education and Other segments. It owns and operates various television networks under the Discovery Channel, TLC, Animal Planet, Investigation Discovery, Science Channel, Velocity, Discovery Family Channel, Destination America, American Heroes Channel, Discovery Life, The Oprah Winfrey Network, Eurosport, Discovery Kids, DMAX, and Discovery Home & Health brands, as well as other regional television networks.
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