Sinclair scores a homerun!

Sinclair Broadcast to acquire 21 Regional Sports Networks from Disney at valuation of $10.6B


Sinclair Broadcast buys Fox College Sports from Disney, Stockwinners

Sinclair Broadcast (SBGI) and The Walt Disney Company (DIS) announced that they have entered into a definitive agreement under which Sinclair will acquire the equity interests in 21 Regional Sports Networks and Fox College Sports, which were acquired by Disney in its acquisition of Twenty-First Century Fox.

Sinclair scores a home run by this purchase, Stockwinners

The transaction ascribes a total enterprise value to the RSNs equal to $10.6B, reflecting a purchase price of $9.6B, after adjusting for minority equity interests.

That’s far cheaper than the $15 billion to $25 billion range most analysts had predicted Disney could get.

Disney assets do not fetch the price that was expected for the assets, Stockwinners

Completion of the transaction is subject to customary closing conditions, including the approval of the U.S. Department of Justice.

The RSN portfolio, which excludes the YES Network, is the largest collection of RSNs in the marketplace today, with an extensive footprint that includes exclusive local rights to 42 professional teams consisting of 14 Major League Baseball teams, 16 National Basketball Association teams, and 12 National Hockey League teams.

In calendar year 2018, the RSN portfolio delivered a combined $3.8B in revenue across 74M subscribers.

The RSNs will be acquired via a newly formed indirect wholly-owned subsidiary of Sinclair, Diamond Sports Group.

Byron Allen has agreed to become an equity and content partner in a newly formed indirect wholly-owned subsidiary of Sinclair and an indirect parent of Diamond.

Allen, who bought The Weather Channel in 2018, is the Founder, Chairman, and CEO of Entertainment Studios, a global media, content and technology company.

Byron Allen who bought the Weather Channel in 2018 invests in the transaction, Stockwinners

Sinclair expects to capitalize Diamond with $1.4B in cash equity, comprised of a combination of approximately $0.7B of cash on hand and a contribution of $0.7B in the form of new fully committed debt at Sinclair Television Group.

In addition, the purchase price will be funded with $1B of fully committed privately-placed preferred equity of a newly-formed indirect wholly-owned subsidiary of Sinclair and direct parent of RSN Holding Company.

The remainder of the purchase price is being funded by $8.2B of fully committed secured and unsecured debt incurred by Diamond.

The transaction will be treated as an asset sale for tax purposes, with Sinclair receiving a full step-up in basis.

The transaction has been unanimously approved by the Board of Directors of both Sinclair and Disney.

In March, Sinclair, Blackstone and Amazon backed the New York Yankees’ $3 billion re-purchase of the 80% of YES Network the team had sold to Fox in 2014. YES Network was the 22nd channel in the former Fox portfolio, and was seen as the crown jewel.

And back in February, Sinclair partnered with the Chicago Cubs to create a new RSN in Chicago, to be called Marquee Sports Network, that will air all local Cubs games beginning in 2020.

Sinclair also own the Tennis Channel, Stockwinners

Sinclair is the largest owner of local television stations (it owns 200) in the country. SBG also owns the Tennis Channel. (It is also a partner in the joint venture sports streaming platform Stadium.) By 2020, it will operate 22 regional sports networks, plus a minority ownership stake in YES.

SBGI closed at $44.95. DIS closed at $134.33.

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Tribune to buy nineteen stations from Nexstar

Nexstar enters agreements to divest nineteen stations for $1.32B

Nexstar to sell 19 stations, Stockwinners

Nexstar Media Group (NXST) and Tribune Media Company (TRCO) announced that Nexstar has entered into definitive agreements to sell a total of nineteen stations in fifteen markets for an aggregate $1.32B in cash following the acquisition of Tribune Media by Nexstar.

Under the terms of the agreements, TEGNA Inc. (TGNA) will acquire eleven stations in eight markets for $740M and The E.W. Scripps Company (SSP) will acquire eight stations in seven markets for $580M.

Separately, Nexstar remains engaged in active negotiations to divest two stations in Indianapolis, Indiana. On December 3, 2018, Nexstar and Tribune Media entered into a definitive merger agreement whereby Nexstar will acquire all outstanding shares of Tribune Media.

Nexstar agrees to acquire Tribune Media, Stockwinners
Nexstar agrees to sell stations from Tribune, Stockwinners

The planned divestiture of nineteen stations reflects Nexstar’s stated intention to divest certain television stations in order to comply with the FCC local and national television ownership rules and to obtain FCC and Department of Justice approval of the proposed Nexstar / Tribune Media transaction.

Nexstar intends to use the net proceeds from the divestitures to fund the Tribune acquisition and to reduce debt.

Given that the net proceeds from the divestitures exceed those initially estimated at the time the transaction was announced, Nexstar now estimates that net leverage at the closing of the transaction will be reduced to approximately 5.1x.

The planned divestiture of the nineteen stations is subject to FCC approval, other regulatory approvals, the closing of the Nexstar / Tribune Media transaction and other customary closing conditions and is expected to be completed on, or about the time of, the closing of the Nexstar / Tribune Media transaction, which is expected later this year.

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Multi-Color sold for $2.5 billion

Multi-Color to be acquired by Platinum Equity affiliate for $50 per share in cash

Multi-Color to be acquired by Platinum Equity affiliate for $50 per share in cash, Stockwinners
Multi-Color to be acquired by Platinum Equity affiliate for $50 per share in cash, Stockwinners

Multi-Color Corporation (LABL) announced that it has entered into a definitive merger agreement to be acquired by an affiliate of Platinum Equity LLC.

Under the terms of the agreement, which has been unanimously approved by Multi-Color Corporation’s Board of Directors, Multi-Color Corporation shareholders will receive $50.00 in cash for each share of common stock they own, in a transaction valued at $2.5B including the assumption of $1.5B of debt.

The cash purchase price represents a premium of approximately 32 percent over Multi-Color Corporation’s 30-day volume weighted average share price prior to January 22, 2019, the last trading day prior to media speculation regarding a potential transaction involving Multi-Color Corporation.

The transaction will be financed through a combination of committed equity financing provided by Platinum Capital Partners IV, L.P., as well as debt financing that has been committed to by Bank of America Merrill Lynch, Deutsche Bank AG New York Branch, Deutsche Bank AG Cayman Islands Branch and Deutsche Bank Securities Inc.

The transaction is expected to be completed by Q3 FY 2019 and is subject to Multi-Color Corporation shareholder approval, regulatory clearances and other customary closing conditions.

Upon the completion of the transaction, Multi-Color Corporation will become a privately held company and shares of Multi-Color Corporation common stock will no longer be listed on any public market.

Constantia Flexibles Holding GmbH and affiliates of Diamond Castle Partners, who together currently own 5,889,093 shares of Multi-Color Corporation common stock, representing approximately 28.7 percent of Multi-Color Corporation’s outstanding shares, have each separately entered into a voting and support agreement to vote its shares in favor of the transaction as provided in each agreement.

The Multi-Color Corporation Board has unanimously recommended that all of Multi-Color Corporation’s shareholders vote to approve and adopt the merger agreement at an upcoming special meeting of Multi-Color Corporation’s shareholders.

LABL closed at $48.55.


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Tribune Media sold for $6.4 billion

Nexstar to acquire Tribune Media for $46.50 per share

Nexstar agrees to acquire Tribune Media, Stockwinners
Nexstar agrees to acquire Tribune Media, Stockwinners

Nexstar Media Group (NXST) and Tribune Media (TRCO) announced that they have entered into a definitive merger agreement whereby Nexstar will acquire all outstanding shares of Tribune Media for $46.50 per share in a cash transaction that is valued at $6.4B including the assumption of Tribune Media’s outstanding debt.
The transaction reflects a 15.5% premium for Tribune Media shareholders based on its closing price on November 30, 2018, and a 45% premium to Tribune Media’s closing price on July 16, 2018, the day the FCC Chairman issued a public statement regarding his intention to circulate a Hearing Designation Order for Tribune Media’s previously announced transaction with a third party.
Tribune Media shareholders will be entitled to additional cash consideration of approximately 30c per month if the transaction has not closed by August 31, 2019, pro-rated for partial months and less an adjustment for any dividends declared on or after September 1, 2019.
The transaction has been approved by the boards of directors of both companies and is expected to close late in the third quarter of 2019, subject to receipt of required regulatory approvals and satisfaction of other customary closing conditions.
Upon closing, the transaction is expected to be immediately accretive to Nexstar’s operating results inclusive of expected operating synergies of approximately $160M in the first year following the completion of the transaction and planned divestitures.
The proposed transaction will combine two leading local media companies with complementary national coverage and will reach approximately 39% of U.S. television households pro-forma for anticipated divestitures and reflecting the FCC’s UHF discount.
The transaction is not subject to any financing condition and Nexstar has received committed financing for the transaction from BofA Merrill Lynch, Credit Suisse and Deutsche Bank. Completion of the transaction is subject to approval by Tribune’s shareholders, as well as customary closing conditions, including approval by the FCC, and satisfaction of antitrust conditions.

Nexstar intends to divest certain television stations necessary to comply with regulatory ownership limits and may also divest other assets which it deems to be non-core. All after-tax proceeds from such asset sales are expected to be applied to leverage reduction.


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JP Morgan is positive on NY Times

NY Times rises on subscriber growth, Analyst Comments

JP Morgan is positive on NY Times, Stockwinners
JP Morgan is positive on NY Times, Stockwinners

Shares of New York Times (NYT) have jumped after the company reported better than expected third quarter results and strong subscriber growth.

Notably, the Times’ 203,000 total net new digital-only subscriptions represents the highest gain in digital subscribers in a quarter since the “Trump bump” in the fourth quarter of 2016 and the first quarter of 2017 after the presidential election.

Commenting on the announcement, JPMorgan analyst Alexia Quadrani told investors that she is “extremely encouraged” by the results and sees momentum continuing on digital subscriber additions.

QUARTERLY RESULTS

New York Times reported third quarter adjusted earnings per share of 15c and revenue $417.35M, both above consensus of 11c and $408.54M, respectively.

The number of digital subscribers showed a net increase of roughly 203,000, with 143,000 of those signing on for digital new products and the remainder paying for the company’s cooking and crossword features.

Operating profits rose 30% to $41.4M in the period.

Mark Thompson, president and CEO, said, “This was a strong third quarter for the company. […] We passed two significant milestones, and now have more than 3M digital-only subscriptions and more than 4M total subscriptions. We’re executing on our subscription-first strategy; this quarter, subscription revenues accounted for nearly two-thirds of the company’s revenues. We’re investing aggressively in our journalism, product and marketing and are seeing tangible results in our digital growth.

Turning to advertising, as expected, we are seeing a much stronger second half of the year. We had an exceptional third quarter with digital advertising up 17% and growth of 7% in total advertising.”

Responding to a question during its earnings conference call from JPMorgan’s Quadrani regarding potential subscription drivers, including stories that may have caused a spike in adds, the company highlighted the “important role” played by the $1 per week promotion.

NY Times also acknowledged that “there were some spikes” during the quarter related to specific stories, namely “the anonymous editorial, the story about family separation at the border and the one on the Trump family.”

MOMENTUM TO CONTINUE

In a post-earnings note, JPMorgan‘s Quadrani pointed out that NY Times reported third quarter earnings with revenue, adjusted operating profit, and EPS all ahead of consensus and her estimates.

Most notably, the analyst noted that digital subscriber net adds in the quarter were 203,000 compared to her 130,000 estimate, with the core news product adding 143,000 and digital other adding 60,000.

The 143,000 net adds for news compares to 68,000 in the second quarter, and is the best quarter for the company since the “Trump bump” driven first quarter of 2017, Quadrani contended.

Overall, the analyst said she is “extremely encouraged” by these results and sees momentum continuing on digital subscriber additions helped by the current elevated news cycle and the midterm elections. Quadrani has an Outperform rating on the shares.

FAILING’ NEW YORK TIMES

Last month, Trump criticized a NY Times investigation into his and his family’s use of “dubious tax schemes” over the years and the origins of his own wealth, calling the article an “old, boring and often told hit piece.”

In a tweet, the President said “The Failing New York Times did something I have never seen done before. They used the concept of “time value of money” in doing a very old, boring and often told hit piece on me. Added up, this means that 97% of their stories on me are bad. Never recovered from bad election call!”

This is not the first time Trump called the publication the “failing New York Times.”

Denouncing what he referred to as a “gutless editorial” posted by the New York Times in September, in which an unnamed administration official alleged that advisers to the President were intentionally attempting to thwart his misguided impulses from the inside, Trump tweeted: “Does the so-called “Senior Administration Official” really exist, or is it just the Failing New York Times with another phony source? If the GUTLESS anonymous person does indeed exist, the Times must, for National Security purposes, turn him/her over to government at once!”

PRICE ACTION

In Thursday’s trading, shares of New York Times gained 7.5% to $28.39.


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Tribune Media terminates merger agreement with Sinclair Broadcast

Tribune Media terminates merger agreement with Sinclair Broadcast, files suit

Tribune Media terminates merger agreement with Sinclair Broadcast, Stockwinners
Tribune Media terminates merger agreement with Sinclair Broadcast, Stockwinners

Tribune Media (TRCO) announced that it has terminated its merger agreement with Sinclair Broadcast Group (SBGI), and that it has filed a lawsuit in the Delaware Chancery Court against Sinclair for breach of contract.

The lawsuit seeks compensation for all losses incurred as a result of Sinclair’s material breaches of the Merger Agreement.

In the Merger Agreement, Sinclair committed to use its reasonable best efforts to obtain regulatory approval as promptly as possible, including agreeing in advance to divest stations in certain markets as necessary or advisable for regulatory approval.

Instead, in an effort to maintain control over stations it was obligated to sell, Sinclair engaged in unnecessarily aggressive and protracted negotiations with the Department of Justice and the Federal Communications Commission over regulatory requirements, refused to sell stations in the markets as required to obtain approval, and proposed aggressive divestment structures and related-party sales that were either rejected outright or posed a high risk of rejection and delay-all in derogation of Sinclair’s contractual obligations.

Ultimately, the FCC concluded unanimously that Sinclair may have misrepresented or omitted material facts in its applications in order to circumvent the FCC’s ownership rules and, accordingly, put the merger on indefinite hold while an administrative law judge determines whether Sinclair misled the FCC or acted with a lack of candor.

As elaborated in the complaint we filed earlier today, Sinclair’s entire course of conduct has been in blatant violation of the Merger Agreement and, but for Sinclair’s actions, the transaction could have closed long ago.

“In light of the FCC’s unanimous decision, referring the issue of Sinclair’s conduct for a hearing before an administrative law judge, our merger cannot be completed within an acceptable timeframe, if ever,” said Peter Kern, Tribune Media’s CEO.

“This uncertainty and delay would be detrimental to our company and our shareholders. Accordingly, we have exercised our right to terminate the Merger Agreement, and, by way of our lawsuit, intend to hold Sinclair accountable.”


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MoviePass raises prices

Helios and Matheson says MoviePass accelerating plan for profitability

MoviePass raises prices, Stockwinners
MoviePass raises prices, Stockwinners

MoviePass, a majority-owned subsidiary of Helios and Matheson Analytics (HMNY), announced the implementation of several new measures aimed at accelerating the plan for profitability.

Through these new steps, the company believes it will be able to compress its timeline to reach profitability.

Approaching the one-year anniversary of introducing its standard $9.95 price point, the MoviePass community has grown to more than 3 million members and in turn has contributed to record box office growth, responsible for approximately 6 percent of the nation’s total box office sales in the first half of 2018.

In addition, MoviePass Ventures and MoviePass Films are contributing to the company’s ancillary revenue. The company has implemented several elements of a long-term growth plan to protect the existing community and set it up for future sustainable growth.

MoviePass has implemented several new cost-reduction and subscription revenue increase measures: Actions that have been implemented are currently cutting the monthly burn by 60%.

A future increase of the standard pricing plan to $14.95 per month within the next 30 days.

First Run Movies opening on 1,000+ Screens to be limited in their availability during the first two weeks, unless made available on a promotional basis, Implementation of additional tactics to prevent abuse of the MoviePass service.

As of Q3 and beyond, MoviePass is also generating incremental non-subscription revenue of approximately $4 to $6 per subscriber per quarter: Integration of MoviePass Ventures and MoviePass Films with our own original content allows us to gain revenue by owning the films through box office, streaming, DVD, retail, transactional sales e.g. Apple and Samsung, and international rights, etc.

Partnerships with 3rd party media inventory to increase scale and reach of marketing efforts driven by data. Continued rollout and refinement of the Peak Pricing program.

Creating strategic marketing partnerships and promotions with studios, content owners, and brands. Integration of Moviefone.Com to support the media buys of brands and studios.

In an effort to maintain the integrity of the MoviePass mission, to enhance discovery, and to drive attendance to smaller films and bolster the independent film community, MoviePass will begin to limit ticket availability to Blockbuster films. This change has already begun rolling out, with Mission Impossible 6 being the first film included in the measure.

This is a strategic move by the company to both limit cash burn and stay loyal to its mission to empower the smaller artistic film communities.

Major studios will continue to be able to partner with MoviePass to promote their first run films, seeding them with a valuable moviegoing audience.

HMNY is up 7 cents to $0.88.


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Disney raises its offer for 21st Century Fox to $38 per share

Disney boosts offer for 21st Century Fox assets to $38 per share

Disney raises its offer for 21st Century Fox to $38 per share

Twenty-First Century Fox (FOXA) announced that it has entered into an amended and restated merger agreement with Walt Disney (DIS) pursuant to which Disney has agreed to acquire for a price of $38 per 21CF share the same businesses Disney agreed to acquire under the previously announced merger agreement between 21CF and Disney.

This price represents a “significant increase” over the purchase price of approximately $28 per share included in the Disney merger agreement when it was announced in December 2017.

The amended and restated Disney merger agreement offers a package of consideration, flexibility and deal certainty enhancements that is superior to the proposal made by the Comcast Corporation (CMCSA) on June 13, Fox stated.

Under the amended and restated Disney merger agreement, Disney would acquire those businesses on substantially the same terms, except that, among other things, Disney’s offer allows 21CF stockholders to elect to receive their consideration, on a value equalized basis, in the form of cash or stock, subject to 50/50 proration.

The collar on the stock consideration will ensure that 21st Century Fox shareholders will receive a number of Disney shares equal to $38 in value if the average Disney stock price at closing is between $93.53 and $114.32.

In light of the revised terms contained in the amended and restated Disney Merger Agreement, 21CF’s board, after consultation with its outside legal counsel and financial advisors, has not concluded that the unsolicited proposal it received on June 13, 2018 from Comcast could reasonably be expected to result in a “Company Superior Proposal” under the Disney merger agreement.

However, the amended and restated Disney merger agreement contains no changes to the provisions relating to the company’s directors’ ability to evaluate a competing proposal.

As announced on May 30, 2018, 21CF has established a record date of May 29, 2018 and a meeting date of July 10, 2018, for a special meeting of its stockholders to, among other things, consider and vote on a proposal to adopt the Disney merger agreement.

21CF has determined to postpone its special meeting of stockholders to a future date in order to provide stockholders the opportunity to evaluate the terms of Disney’s revised proposal and other developments to date.

Once 21CF determines the new date for 21CF’s special meeting of stockholders, the date will be communicated to 21CF stockholders.


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CBS blocks Dish Network

CBS blacks out DISH subscribers, DISH offers OTA antennas at no cost 

CBS black outs DISH Network. See Stockwinners.com for details

DISH reported that CBS Corporation (CBS) chose to black out DISH customers’ access to 28 local channels in 18 markets across 26 states.

CBS is blocking consumers in an effort to raise carriage rates for local channels and gain negotiating leverage for unrelated cable channels, all with declining viewership on DISH.

“CBS is attempting to tax DISH customers on programming that’s losing viewers, tax DISH customers on programming available for free over the air, and tax DISH customers for content available directly from CBS,” said Warren Schlichting, DISH executive vice president of Marketing, Programming and Media Sales.

“Our customers are clear: they don’t want to pay a CBS tax. It’s regrettable and unnecessary that CBS is bringing its greed into the homes of millions of families this Thanksgiving.”

On a recent investor conference call, CBS boasted about the rate increases promised to shareholders, going from $250 million in 2012 to a forecasted $2.5 billion by 2020.

Those desired increases come as DISH customers are watching less CBS, with average viewership down 20 percent over the past 3 years.

As DISH works to reach an agreement, the company is offering digital over-the-air, or OTA, antennas at no cost so that customers in affected markets can watch CBS’s local broadcast channels for free.

Eligible DISH customers have the option to completely drop their local channels from their programming package, saving $10 on their monthly bill.

In recent weeks, thousands of eligible DISH customers in CBS markets have made the switch to OTA, accessing news, popular network shows and sports from CBS and other local channels for free, over the air.

Customers with qualifying equipment, programming, and location can choose to receive local channels free over the air and save $10 per month on their bill. At no cost, DISH will install an antenna for qualifying customers in CBS markets based on the reception available at their home.

In addition to asking for significant price increases for local channels, CBS is attempting to “force bundle” unrelated and low-performing cable channels at a premium.

“CBS is using its mix of local and national channels against viewers, abusing outdated laws to try to force consumers to pay more. This greedy attempt to extort more money from our customers is one of the main reasons we – and our industry – are asking Congress to restore balance in the broadcaster-pay TV equation,” said Jeff Blum, DISH senior vice president and deputy general counsel.

“We are asking lawmakers to reform outdated TV laws to give our customers the best viewing experience at an affordable price – without the threat of broadcaster blackouts.”

Along with other pay-TV companies and public interest groups that form the American Television Alliance, DISH has called for the U.S. Congress to revamp the out-of-date laws that favor these high fees and unnecessary blackouts.

Blum continued: “We continue to urge the FCC and Congress to update a system that emboldens broadcasters to black out consumers.”


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Netflix Reports Today

What to watch in Netflix earnings report

Disney loss having minimal impact on Netflix subscribers. See Stockwinners.com Market Radar to read more

Netflix (NFLX) is scheduled to report results of its third fiscal quarter after market close on October 16, with a conference call scheduled for 6:00 pm ET.

What to watch:

1. SUBSCRIBER FORECASTS, PRICE HIKE:

Netflix’s subscriber numbers are a closely-watched measure of the company’s growth trajectory. Last quarter, the company reported streaming net additions of 5.2M members, including second quarter U.S. additions of 1.07M and international additions of 4.14M members. Turning to its Q3 outlook, Netflix had forecast streaming net additions of 750,000 in the U.S. and international streaming net additions of 3.65M. On October 5, Netflix announced a price increase in the U.S., U.K., and other select markets, noting that the last time it had changed prices in the U.S. was 2015.

2. NO ‘UN-GRANDFATHERING’ THIS TIME:

A number of analysts have been bullish about Netflix shares since its price increase announcement, voicing support for its pricing power.

Morgan Stanley analyst Benjamin #Swinburne raised his price target on Netflix shares to $225 from $210, stating that he expects less of a churn impact from its new domestic price increases. He estimates that higher average revenue per user will more than offset the estimated near-term subscriber impact from the price increases and raised his 2018 revenue estimates to reflect that view.

Stifel analyst Scott #Devitt raised his price target on Netflix to $230 from $200 ahead of the company’s Q3 earnings report, saying he expects “healthy subscriber trends” in the quarter and for the current price increase to be much less disruptive than last year.

Meanwhile, Goldman analyst Heath #Terry believes Netflix consensus subscriber estimates are too low, particularly for Q4 and beyond. Terry’s second half net subscriber addition forecast of 13.9M is considerably above consensus of 10.8M, which he believes management is likely to exceed.

Terry also boosted Netflix’s price target to $235 from $200 on faster top-line growth and revised estimates and reiterated his Buy rating on the shares. 3.

BULLISH EVEN BEFORE HIKE:

Early this month, before the company announced its price increase plans, UBS and Piper Jaffray predicted that the company’s third quarter subscriber data would come in above expectations.

The positive momentum that Netflix saw in the second quarter continued at similar rates in the third quarter, wrote analyst Doug #Mitchelson on October 4, noting that the continued strong year-over-year subscriber growth “across almost all markets” came despite a downturn in the quality of the company’s original programming last quarter. He raised his Q3 U.S. net subscriber addition estimate by 100,000 to 850,000 and increased his Q3 international net add estimate by 300,000 to 3.95M.

Meanwhile, on the same day, Piper Jaffray‘s Michael #Olson said that after analyzing Google search trends he believed that Netflix’s international and domestic subscriber growth beat expectations last quarter.

The analyst said the search data suggests that the company’s U.S. subscriber base jumped 16% in Q3, while its foreign subscriber base surged by 71% year-over-year, both of which were better than the consensus growth outlook at that time.

OPTIONS  MARKET

Pre-earnings options volume in Netflix is 1.6x normal with calls leading puts 8:7. Implied volatility suggests the market is anticipating a move near 11.9%, or $23.79, after results are released. Median move over the past eight quarters is 10.6%.

NFLX last traded at $201.18, up $1.69.


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The Real Winners of Mayweather McGregor Fight

CBS will broadcast the fight on radio while its subsidiary, Showtime charges $100 for pay-per-view

The real winner of Mayweather vs McGregor. See Stockwinners.com to read more

Tonight’s matchup between Floyd Mayweather and Conor McGregor has been called the “The Money Fight.” You may ask why?  The $99.95 high-definition price tag on CBS Corp.’s Showtime is the highest ever charged for a pay-per-view event. CBS (CBS) expects about 4.9 million viewers will sign up for the broadcast.

It is the most distributed event in pay-per-view history. It will be shown in in over 200 countries on pay-per-view.

WINNERS

CBS has deals with other companies to show the fight live. Buffalo Wild Wings (BWLD) will show the fight at most of its 1,220 restaurants. Stocks of BWLD and CBS are probably worth watching more than the fight itself!

It is estimated that  $700 million revenue will be generated from pay-per-view buys, ticket sales and other sources of income, according to sources. By comparison, Mayweather’s record-breaking match with Pacquiao in 2015 raked in an estimated $600 million. And let’s not forget tickets to the T-Mobile Arena, sponsorships, simulcast rights, merchandise and the many peripheral activities — gambling, hotel stays, meals — leading up to the big day on the Las Vegas Strip.

Japan’s boxing fans can view the fight with their smartphone and a $15 subscription to DAZN, a UK-owned sports streaming service that’s seeking to turn sports nuts into cord cutters.  This is a new business model for pay-per-view.

“Mayweather vs. McGregor truly is a unique event and I doubt there will ever be one quite like it in the future,” said CEO of DAZN James Rushton. “We are analyzing how fans react to having this fight on DAZN and will evaluate if it’s something we want to continue doing in the future.”

Floyd Mayweather is expected to have a $300 million payday while McGregor is set to earn anywhere from $50 million to $100 million, according to various estimates.

[youtube https://www.youtube.com/watch?v=8oXy51JvkFY&w=640&h=360]

The last time Mayweather lost was in 1996, in a highly controversial decision at the semi-finals of the Atlanta Olympic Games, to Bulgarian Serafim Todorov. Even the Egyptian referee for the fight assumed Mayweather had won and held Mayweather’s hand aloft just as Todorov was announced as the winner.  It would seem a mistake to bet against Mayweather now!

LOSERS

The biggest loser of the night will be HBO and its parent company Time Warner or soon to be AT&T (T).

With no real challengers remaining in boxing this year, Mayweather turned to the UFC and its biggest star, Conor McGregor. According to insiders, he timed the announcement and staged the fight in a manner designed to deal maximum damage to his former network partner, HBO, and two of their biggest pay-per-view fights of 2017.

Begin with the choice of an Aug. 26 fight date. “It’s perverse,” tells Bloomberg Jim Lampley, HBO boxing’s longtime commentator. “If there’s one indelible, accepted principle in operating pay-per-view, it’s ‘never before Labor Day.’

That’s why, for the upcoming HBO bout between middleweight titleholder Gennady Golovkin and former champ Canelo Alvarez—one of boxing’s best tilts, on paper, in years—the channel jumped on Sept. 16 to maximize the number of pay-per-view buys, assuming that Showtime would choose a later date in the fall for Mayweather-McGregor.

Instead, Mayweather-McGregor was set for Aug. 26, creating a tidal wave of publicity that is currently drowning the lead-up to the Canelo-Golovkin fight.

ODD MAKERS

The action is reflected in the odds, which bookmakers adjust either way as money comes in on the two fighters. Bookmakers have been lowering the odds steadily since the fight was announced, but even that hasn’t stopped the deluge of McGregor bets.

The big bettors are putting their money on Mayweather, who is 49-0 as a pro. But so many McGregor fans are betting small amounts that the betting slips were running 18-1 in the Irish fighter’s favor. McGregor fans have flooded sports books with $100 bills backing the mixed martial arts fighter, and even a late surge of money on Mayweather might not be enough to balance the books.

A fight that began with Mayweather an 11-1 favorite is now 5-1 or even less in some sports books.

Should McGregor somehow manage to knock out Floyd Mayweather Jr. in the early rounds Saturday night, Las Vegas’ bookmakers would lose millions of dollars in the biggest single event loss in the history of sports betting, according to Fox Business


Floyd Mayweather vs Conor McGregor

Date: Saturday, Aug. 26, 2017
Time: 9 p.m. ET
Location: T-Mobile Arena in Las Vegas


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Survey Shows Netflix is Fine without Disney

Analyst sees Disney loss having minimal impact on Netflix subscribers

Disney loss having minimal impact on Netflix subscribers. See Stockwinners.com Market Radar to read more

Although Netflix (NFLX) shares slipped following Disney’s (DIS) announcement that the company was ending its distribution agreement with the former, Piper Jaffray analyst Michael Olson told investors that he believes the loss will have a minimal impact on the streaming service subscribers.

SURVEY SAYS

In a research note to investors this morning, #Piper #Jaffray’s Olson says Disney ending its agreement for distribution of certain content is a negative headline, but it will have “minimal impact” on Netflix.

This follows his firm survey of over 500 U.S. Netflix subscribers, asking what percent of their Netflix time is spent on Disney.

The analyst pointed out that Piper found that “only” around 20% of subscribers spend greater than 10% of their Netflix time viewing Disney content.

Further, he expects “almost none” of the remaining 80% of subscribers to cancel due to the loss of Disney.

The 20% of heavier Disney viewers are unlikely to cancel unless Disney accounts for a larger portion, greater than 40%, of their Netflix viewing time, Olson contended.

While #Olson recognized the strength of Disney’s content, particularly for younger children, the analyst noted that he believes Netflix can license similar genre content from other sources and/or use the cost savings for original programming.

Netflix is likely already in the process of determining how to effectively reallocate funds previously earmarked for Disney, he said, adding that the company has nearly 18 months to plan for this change. The analyst reiterated an Overweight rating and $215 price target on Netflix’s shares.

ENDING AGREEMENT

Last week when Disney reported third quarter earnings, the company announced that it will launch its ESPN-branded multi-sport video streaming service in early 2018, followed by a new Disney-branded direct-to-consumer streaming service in 2019. Additionally, Disney said it will end its distribution agreement with Netflix for subscription streaming of new releases, beginning with the 2019 calendar year film slate.

PRICE ACTION

In Monday morning trading, shares of Netflix have dipped 0.66% to $170.27, while Disney’s stock is fractionally up to $102.20.


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Altice is Interested in Charter

If a deal goes through, Charter could fetch over $470 a share

Altice is Interested in Charter. See Stockwinners.com Market Radar for details

Altice (ATUS), the cable and telecoms group controlled by Franco-Israeli billionaire Patrick Drahi, is lining up a potential $185 billion bid for Charter Communications (CHTR), the second-largest US cable company, according to the FT.com.

The move highlights an expected wave of consolidation in the industry as cable companies enter the wireless business and also look for additional ways to cut costs and grow as more U.S. consumers are cutting their cords.

Altice USA’s initial public offering in June was viewed as a means for Altice to expand into U.S. cable empire by giving the company public stock it can use as currency for new acquisitions.

In May, #Drahi told reporters that he considered cable expansion a priority, followed by mobile and content.

Altice is working with banks to finance the deal through cash and equity, a source said.

Buying another cable company would give Altice USA, currently the fourth-biggest U.S. cable provider, the opportunity to build more scale and cut costs in the United States. Altice completed its $17.7 billion acquisition of Cablevision last June, after buying Suddenlink for $9.1 billion in 2015.

CHTR last traded at $398.45. ATUS  last traded at $30.95.

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Disney to End Netflix Distribution Agreement

Disney to end Netflix distribution agreement in 2019

Disney to end Netflix distribution agreement in 2019. See Stockwinners.com Market Radar for details

Disney (DIS) said that following its acquisition of an additional 42% stake of BAMTech, it will end its distribution agreement with Netflix (NFLX) for subscription streaming of new releases, beginning with the 2019 calendar year theatrical slate.

Disney will launch its ESPN-branded multi-sport video streaming service in early 2018, followed by a new Disney-branded direct-to-consumer streaming service in 2019.

BAMTech is a streaming technology provider joint venture between Baseball Advanced Media, The Walt Disney Company and the National Hockey League. The company handles streaming for #HBO, #MLB, #NHL and #WWE.

“The new service will be accessed through an enhanced version of the current ESPN app. In addition to the multi-sport service, the ESPN app will include the news, highlights, and scores that fans enjoy today. Consumers who are pay TV subscribers will also be able to access the ESPN television networks in the same app on an authenticated basis. For many sports fans, this app will become the premier digital destination for all their sports content,” it explained.

Following the news, both NFLX and DIS are down.

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Discovery to acquire Scripps for $14.6B

Discovery to acquire Scripps for $90 per share in cash and stock deal

Media Stocks to Watch, Stock to Watch today, Stock of the day, Stock Headline, media mergers

Discovery Communications (DISCA) and Scripps Networks Interactive (SNI) announced that they have signed a definitive agreement for Discovery to acquire Scripps in a cash-and-stock transaction valued at $14.6B, or $90 per share, based on Discovery’s Friday, July 21 closing price.

The purchase price represents a premium of 34% to Scripps’ unaffected share price as of Tuesday, July 18, 2017.

The transaction is expected to close by early 2018.

Combined, Discovery and Scripps will have nearly 20% share of ad-supported pay-TV audiences in the U.S. Additionally, the combined company will be home to five of the top pay-TV networks for women and will account for over 20% share of women watching primetime pay-TV in the U.S.

The combination is expected to create significant cost synergies, estimated at approximately $350M. The deal is expected to be accretive to adjusted EPS and to Free Cash Flow in the first year after close.

Scripps shareholders will receive $90 per share under the terms of the agreement, comprised of $63.00 per share in cash and $27.00 per share in Class C Common shares of Discovery stock, based on Discovery’s Friday, July 21 closing price. The stock portion will be subject to a collar based on the volume weighted average price of Discovery Class C Common Shares over the 15 trading days ending on the third trading day prior to closing.

Scripps shareholders will receive 1.2096 Discovery Class C Common shares if the Average Discovery Price is below $22.32, and 0.9408 Discovery Class C Common shares if the Average Discovery Price is above $28.70. If the Average Discovery Price is greater than or equal to $22.32 but less than or equal to $28.70, Scripps shareholders will receive a number of shares between 1.2096 and 0.9408 equal to $27.00 in value.

If the Average Discovery Price is between $22.32 and $25.51, Discovery has the option to pay additional cash instead of issuing more shares.

Scripps shareholders will have the option to elect to receive their consideration in cash, stock or the mixture described above, subject to pro rata cut backs to the extent cash or stock is oversubscribed. This purchase price implies a total transaction value of $14.6 billion, including the assumption of Scripps’ net debt of approximately $2.7 billion.

Post-closing, Scripps’ shareholders will own approximately 20% of Discovery’s fully diluted common shares and Discovery’s shareholders will own approximately 80%. Kenneth Lowe, Chairman, President & CEO, Scripps Networks is expected to join Discovery’s board following the close of the transaction.

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