ITV must now be a bargain. The current team clearly are an issue but you'd think the big American companies would recognise the bargain.

The yield is also high and can be reinvested. That really does limit the down side. You can even win here if it drops further!

Well oversold Stan, falling knife to 180p perhaps until Brexit outcome.

Goldman Sucks go below 23% now.

ITV worries investors over 'backdrop of uncertainty' in advertising market


Christopher Williams, chief business correspondent
12 MAY 2016 • 5:27PM
ITV gave investors cause for concern as it revealed advertising sales slumped 13pc in April compared with last year, with brands holding off spending ahead of the EU referendum.

The broadcaster’s shares slid 2.4pc on the first quarter update, amid claims by some analysts and senior industry sources that the market may not return to the same buoyant state regardless of the outcome on June 23.

ITV said it expects advertising to be up 15pc in June, when it is due to benefit from rights to the European Championships football tournament. While advertising sales overall for the first half are expected to be “broadly flat”, chief executive Adam Crozier said he expected to outperform the wider television market.

Yet the more uncertain outlook was enough to turn some in the City against ITV. Neil Campling, an analyst at Northern Trust, told clients to short sell the broadcaster, claiming “the tide is out and they are not wearing pants” because of ITV’s relatively underdeveloped digital strategy.

But others stayed positive. Numis lowered its full year profit estimate but said there was “scope for advertising to rebound when Brexit uncertainty is resolved and [we] stress that with a far greater base of profitability and transformed balance sheet, ITV is much better placed to weather a downturn than in 2008”.

Since the financial crisis advertising crash, ITV has invested heavily in buying up production companies to shield it from advertising volatility. The acquired growth meant that across all its businesses, first quarter sales were up 14pc to £755m.

The company insisted that its position in the linear broadcast television market was “robust”, and highlighted progress turning around a long-term decline in its share of audiences. It main channel has gained 3pc in the first four months of the year compared with 2015.

Mr Crozier said: “ITV is now a much stronger and more diverse business and we expect to deliver good profit growth in the first half.

“This is against the backdrop of uncertainty in the UK advertising market, which we have experienced since the debate over Brexit began.”

ITV also held its AGM, where departing chairman Archie Norman handed over to his successor Sir Peter Bazalgette.

LATEST BROKER VIEWS

Date Broker New target Recomm.
13 May Barclays... 225.00 Equal weight
13 May Deutsche Bank 185.00 Sell
13 May Citigroup 260.00 Buy
13 May JP Morgan... 278.00 Overweight
12 May Numis 255.00 Add
12 May Liberum Capital 375.00 Buy
12 May Peel Hunt 330.00 Buy
11 May Liberum Capital 375.00 Buy
10 May Panmure Gordon 325.00 Buy
9 May JP Morgan... N/A Overweight
Broker Recommendations for ITV

Goldman Sucks go below 21% now! http://www.moneyam.com/action/news/showArticle?id=5344705

Liberum note:
ITV has confirmed it has made a bid for Entertainment One but gave no indication as to whether it will now up its bid following its rejection. We suspect it will not although there is some rationale for a combination of the assets. Reiterate Buy.

ITV has put out a statement confirming it bid for Entertainment One at 236p per share, or £1,030m market capitalisation (with the bid valuing E One at c. £1.2bn (including £182m of net debt) or c. 10x EV / March 2016 EBITDA). Tis follows Entertainment One’s earlier statement confirming ITV was the bidder.

ITV stated that the offer “represented a significant premium over the undisturbed eOne share price” and that, as usual in these situations, it reserves the right to amend its offer or withdraw it. We think ITV may not be prepared to pay the £3+ per share that we believe many E One shareholders want. A major acquisition would also put the question of ITV’s special dividend (10p per share for FY15) into question although ITV did increase the interim ordinary dividend by 26% yoy suggesting it is confident about its ability to pay out a substantial amount in dividends moving forwards.

ITV noted in its release that “the proposed combination with eOne has strong strategic rationale” and that a key part of its strategy is “continuing to build a scaled international content and global distribution business”. However, there is a strong argument for saying that ITV may only want the TV assets (including Mark Gordon, which was responsible for shows such as “Ray Donovan” and “Grey’s Anatomy”) and is not interested in the Film assets, where have seen a mixed operational performance and where there have been investor questions around the cashflow. A more interesting question is whether ITV would want to retain the “Peppa Pig” franchise or would look to sell it to a more children’s-orientated company.

LONDON, Aug 19 (Reuters Breakingviews) – British broadcaster ITV is chasing Peppa Pig-owner Entertainment One in a 1 billion pound bid, which its prey has so far rejected. But the UK free-to-air TV company may be assigned a different role in a future takeover drama. After a more than 25 percent drop in its share price this year so far, and a fall in sterling, ITV could become a target itself.

With an EBITDA margin of around 30 percent, ITV is one of Europe's most profitable free-to-air broadcasters. Its successful content production arm, which makes the kitchen-sink soap opera Coronation Street, accounts for 42 percent of revenue. High-quality TV producers are currently coveted in the media world, because they don't depend on fickle TV advertising. Besides, ITV has become more than one-third cheaper in euro terms since the start of the year, as both the pound and its share price have fallen. That could be a lure for a buyer who thought they could convert ITV's assets into non-sterling future revenue streams.

Luxembourg's RTL Group would be a good fit. Strong in Germany, France and Spain, it lacks a footprint in the UK. With annual revenue of around 10 billion euros, an enlarged RTL would increase its bargaining position relative to multinational advertising customers. And a deal would almost double RTL's content production revenue, lifting its total share to more than 30 percent of sales.

RTL could in theory afford a bid. Say it offered a 35 percent premium – the least that would probably be needed to persuade investors to give up the chase on Peppa Pig and turn seller instead – ITV's equity would be valued at 11 billion pounds. Financing two-thirds with leverage would push the combined group's net debt to 3.8 times 2017 EBITDA. The rest could be paid by raising new equity.

A bottleneck could be RTL majority owner Bertelsmann, which owns 75 percent of the stock. The privately held group may be reluctant to countenance a big acquisition – or risk being diluted through the financing of it. But the race for decent content means taking risks. As Liberum analysts suggest, RTL could even team up with John Malone's Liberty Global , which already owns 9.9 percent of ITV. Malone might take the broadcasting assets, leaving RTL with the production business. The media M&A script could run a number of ways, but there's no reason ITV has to be cast as a buyer.

Context News

- Shares in British free-to-air TV group ITV have fallen more than 25 percent since the start of the year. The company has tabled a 1 billion-pound takeover for Canadian media distribution company Entertainment One, which the target rejected on Aug. 10, saying it undervalued the company.

- For previous columns by the author, Reuters customers can click on STORBECK/

Peppa Pig-owner Entertainment One rejects ITV's 1 bln-pound
offer ...
KKR weighs bid for 'Peppa Pig' owner Entertainment One
-Bloomberg ...
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(On Twitter https://twitter.com/OlafStorbeckEditing by John Foley and Liam Proud) ((olaf.storbeck@thomsonreuters.com; Reuters Messaging: olaf.storbeck.thomsonreuters.com@reuters.net)

Keywords: ITV M&A/BREAKINGVIEWS

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FRANKFURT, Aug 25 (Reuters) – European broadcast group RTL still has scope for major acquisitions this year and has a pipeline of opportunities it is reviewing, its top executives said on Thursday.

"We can still afford to do some significant M&A this year. It's usually rather a matter of identifying opportunities that fully meet our strict investment criteria," Chief Financial Officer Elmar Heggen said in an interview with Reuters.

Asked about potential interest in UK broadcaster ITV , whose share price dropped 30 percent following Britain's vote to leave the European Union, co-Chief Executive Guillaume de Posch said: "We never speculate on any rumour in the market."

"We are very focused on implementing our current strategy. Our M&A strategy is focused on expanding our content and digital business," he added. "We've got a lot on our plate."

(Reporting by Georgina Prodhan; Editing by Maria Sheahan) ((georgina.prodhan@thomsonreuters.com; +49 69 7565 1279; Reuters Messaging:

Further to the announcement made by ITV plc ("ITV") on 10th August 2016, ITV announces that it has withdrawn its proposal to acquire Entertainment One Ltd ("eOne").



ITV continues to believe in the strategic logic and potential benefits of acquiring eOne but has a clear view of the value of the business, recognising that this value would need to be verified by appropriate due diligence. It appears this value is different to the level at which the Board of eOne would currently engage in a more formal process.



ITV has a clear strategy to build a stronger, more diversified international business and will continue its disciplined approach to evaluating its healthy pipeline of potential investment opportunities.

ITV has not joined in the FTSE rise in recent weeks, quite the opposite infact.
2517

Very active all of a sudden, I've not seen any reason why.
2517

Lower indicators looking overbought, outside Bollinger Band which always makes me nervous. Resistance 200p.
<img src="http://charts.moneyam.com/Chart.aspx?Provider=EODIntra&amp;Code=ITV&amp;Size=620&amp;Skin=BlackBlue&amp;Type=3&amp;Scale=0&amp;Span=MONTH3&amp;MA=25;50;200;&amp;EMA=&amp;OVER=SAR;AreaBB;&amp;IND=VOLMA;MACD;SlowSTO;AreaRSI;&amp;XCycle=&amp;XFormat=&amp;Layout=2Line;Default;Price;HisDate&amp;SV=0" alt="Chart.aspx?Provider=EODIntra&amp;Code=ITV&amp;Si" />

<img src="http://charts.moneyam.com/Chart.aspx?Provider=EODIntra&amp;Code=ITV&amp;Size=620&amp;Skin=BlackBlue&amp;Type=3&amp;Scale=0&amp;Span=MONTH3&amp;MA=25;50;200;&amp;EMA=&amp;OVER=SAR;AreaBB;&amp;IND=VOLMA;MACD;SlowSTO;AreaRSI;&amp;XCycle=&amp;XFormat=&amp;Layout=2Line;Default;Price;HisDate&amp;SV=0" alt="Chart.aspx?Provider=EODIntra&amp;Code=ITV&amp;Si" />

WTF Chart wont post.

I think someone at MAM has done an "on the fly" change - and it hasn't worked!

All threads historic postings are affected!

The rise in ITV shares looks to be on the back of an all cash bid of 10.75 for SKY.
2517

WOW, SKY never saw that coming, no wonder ITV up.

Today's rise may well have been a sector effect following SKY, but ITV was at a depressed level - well below its true value (not only my opinion, today's performance kinda says so).

All it does is bring it back to a more realistic level.

I'm a holder, and a little reluctant to say - if this is not supported by something, anything, we may see the gain chipped away again.

Then again, maybe not. If a cup-and-handle formation approaches! It is a faintly rising chart, considering June's low, so it could fit.

Find out Monday no doubt. Full year results 1st March. Let's hope by Monday MAM have sorted out the chart problem, not just on this thread.

Sky bid coincides with tip of the week in IC. Kiss of death?