Deutsche Bank Lifts Price Target on Viacom as Ad Revenue Improves (VIAB)
Analysts at Deutsche Bank increased the price target on media company Viacom, Inc. on Friday due to promising first quarter earnings results.
Deutsche Bank maintained a “Buy” rating on VIAB and now sees shares reaching $65, up from the previous target of $62. This valuation suggests a +7% upside to Friday’s closing price of $60.54.
Deutsche Bank commented, “Viacom’s ad revenue is starting to turn the corner, improving from domestic adv -6.3% Y/Y in C3Q12 to -2% in C1Q13 and potentially growing thereafter, while affiliate revenue growth remains strong at 10%. If Viacom continues to improve ratings its networks could return to margin expansion in FY14 and beyond, sparking further revaluation for shares. Return of capital remains strong ($2.6b for FY13, 9% of shrs out, plus a 2.4% dividend).”
Viacom shares were flat during pre-market trading on Monday. The stock is up +25.19% over the past year.
The Bottom Line
Shares of Viacom (VIAB) have a dividend yield of 1.82% based on Friday’s closing price of $60.54.
Viacom, Inc. (VIAB) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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