Time Warner Inc.
) surged to attain a new 52-week high of $63.05 on Jul 26, 2013,
before closing at $63.02. Shares of this Zacks Rank #3 (Hold)
stock have generated a year-to-date return of roughly 28%.
Based on the current price, this media and entertainment
company is 1.2% below the Zacks Consensus average analyst price
target of $63.81. The company currently trades at a forward P/E
of 17.04x, a 1.3% discount to the peer group average of 17.26x.
Additionally, the company's long-term estimated EPS growth rate
We believe that Time Warner's initiatives, such as foraying
into new markets, divestment activities and digital endeavors,
would augur well for its operating performance in the future.
Moreover, the company's investments in programming, production
and marketing along with its focus on operating and capital
efficiencies appear to be encouraging.
Time Warner has been expanding its digital presence to allow
consumers to enjoy content on a wide range of platforms and
devices. We are optimistic about management's expectations to
achieve low double-digit EPS growth in 2013.
Time Warner has been benefiting from its significant
international presence as it helped the company broaden its
client base and product portfolio. The company operates in the
United Kingdom, Germany, Canada, France, Japan and other
countries besides the United States.
Recently, it entered into a partnership with China's leading
media and entertainment investment fund, China Media Capital. In
our view, this partnership complements the company's strategy to
expand its presence in the Chinese entertainment market.
Moreover, Time Warner, with its strong content and
industry-leading portfolio of renowned brands is likely to
benefit from the largest and fastest growing Chinese media
sector. In recent years, China has emerged as an important market
for media and entertainment companies.
Apart from Time Warner, other stocks such as
L Brands, Inc.
) achieved new 52-week highs of $53.77, $45.85 and $59.85,
respectively, on Jul 26, 2013.
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