MTG Advances as Morgan Stanley Sees Recovery: Stockholm Mover
Modern Times Group AB (MTGB) climbed to its highest price in 10 months in Stockholm trading after Morgan Stanley raised its rating and profit estimates, citing an earnings recovery driven by MTG’s central European business.
The stock rose as much as 3.5 percent to 307.9 kronor, the highest intraday level since Sept. 18, and traded 3.4 percent higher at 307.4 kronor at 10:53 a.m. local time, giving the broadcaster a market value of 21 billion kronor ($3.15 billion).
“MTG offers an interesting recovery story as it pursues reinvestment across several areas of its broadcast portfolio,” Christopher Sellers, Patrick Wellington and Julien Rossi, London-based analysts at Morgan Stanley, said in a note to clients today. Stronger operational performance in central and eastern Europe “should translate into faster near-term earnings growth, even without major TV advertising market recovery.”
Morgan Stanley raised its rating on MTG to equal-weight from underweight and its price estimate by 25 percent to 300 kronor. It also increased its earnings per share estimates for 2013 and 2014 by 4 percent and 6 percent, respectively.
MTG tumbled 31 percent last year as the broadcaster’s third-quarter profit missed estimates and it said it was increasing investment in Nordic pay-TV content, premium channels and its online pay-TV service.
To contact the reporter on this story: Adam Ewing in Stockholm at email@example.com