Bernstein: Investors Need to Completely Rethink the Way They Value Media Companies
In a new valuation, Disney and Time Warner were the biggest losers, while Viacom had been downgraded earlier
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Media stocks have been slammed since the start of the month, triggered by comments out of Disney suggesting an accelerated decline in pay-TV subscribers. Since those comments, Disney is down more than 15 percent, dragging others with it.
Now Sanford C. Bernstein analyst Todd Juenger and his team have a big message for the media industry: Everything has changed. In a note sent out this morning, Juenger not only downgrades Disney and Time Warner; he also says analysts need to change the way they think about valuing this industry all together, as both of the industry's major revenue streams—pay subscribers and advertisers—are in jeopardy.