On Jun 27, 2014, we issued an updated research report on
Liberty Media Corp.
). Liberty Media is steadily restructuring its business model for
realigning several of its subscription-based businesses. The
company has also started providing cable TV services and is
striving to consolidate its foothold in the pay-TV market.
Liberty Media has delivered positive earnings surprises in two of
the last four quarters last year, with an average beat of 32.2%.
The company reported first-quarter 2014 financial results wherein
both the top and the bottom line missed the Zacks Consensus
Recently, Liberty Media announced its plans to increase its stake
by an additional 3.7 million shares in Live Nation Entertainment,
Inc. Liberty Media currently holds a 27% stake in Live Nation
Entertainment, the largest concert promoter and ticketing company
in the U.S. If successfully completed, the deal will help Liberty
Media drive earnings and revenues as Live Nation Entertainment has
performed reasonably well in the last one year. Moreover, Live
Nation's diversified music and entertainment collection will be
distributed over SIRIUS XM's channels while SIRIUS XM's live sports
content will be available for Live Nation. This is certainly poised
to drive subscriber growth and ad revenue going forward.
Currently, Liberty Media controls around a 53% stake of SIRIUS XM
Radio. With nearly 25.6 million subscribers in its kitty, SIRIUS
XM, the leading satellite radio service provider in the U.S., is
expected to generate significant financial synergies for Liberty
Notably, Liberty Media, which holds a 27.3% stake in C
harter Communications Inc.
), was aggressively pursuing the idea of acquiring
Time Warner Cable Inc.
). However, Charter Communications has lost to
) in its bid to acquire Time Warner Cable. This disrupted Liberty
Media's plans to gain significant traction in the U.S. cable
industry. Moreover, stiff competition from pay-TV operators coupled
with macroeconomic fluctuations in the U.S. may hurt the company's
growth in the housing sector.
Liberty Media currently carries a Zacks Rank #3 (Hold).
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