Media stocks lead the market surge on stimulus, reopening, streaming; AMC Entertainment, Discovery, Live Nation Pop – Deadline

Showbiz shares shone on Monday from March with a major market rally around reopening, another vaccine rollout, a stimulus bill, and a combination of bullish earnings and rolling forecasts.

Johnson & Johnson’s vaccine, the country’s third, will be shipped this week and the possibility of a $ 1.9 trillion investment in the U.S. economy looks increasingly likely after the House passed a draft Covid-19 relief law over the weekend and sent it to the Senate.

The DJIA jumped over 700 points or nearly 2.3% and other indexes also jumped with around 95% of all stocks up today and entertainment stands out from the TV exposure through live events.

AMC Entertainment shares have gained 14% as New York is set to reopen theaters Friday after a year of darkness. Volatile stock is partly benefiting from a resurgence of love on Reddit, where investors have switched to some GameStop-led stocks. Other exhibitors saw bumps from Cinemark (up 7%) to Imax and Marcus (up 3%).

Adam Aron, CEO of AMC Entertainment Awards, special bonus of $ 3.75 million for ‘extraordinary effort’ while sailing Covid

Live Nation shares have increased by almost 5%. CEO Michael Rapino said on an earnings call on Friday – citing conversations with state governors – that a “clear picture” had emerged for a reopening of 75% to 100% capacity for events in outdoors in the United States this year. The venue giant also sold tickets to two major UK festivals in August (Reading & Leeds and Creamfields) after the UK government announced major music events could resume at 100% capacity on June 21.

Classic media and entertainment stocks are also dynamic, and perhaps it is time to note an on-going mood change in companies as they move forward in streaming. Many have also published better-than-expected quarterly results in advertising and other metrics after the horrific impact of Covid-19. “But the real catalyst has been the quarterly reporting of OTT subscribers,” said Michael Nathanson, analyst at MoffettNathanson, in a recent report.

Despite an overabundance of new OTT services, Wall Street seems willing to examine each of them in depth, but without assuming that they will survive on their own in the longer term given the difficult economic conditions. Investors are certainly applauding Discovery after CEO David Zaslav announced 7 million new Discovery + streaming subscribers since its launch in December. The service also had a great article today by New York Times media columnist Ben Smith. It’s almost 10%.

AMC Networks CEO Josh Sapan also impressed Street Friday, beating earnings estimates, revealing more than 6 million streaming subscribers by year-end and anticipating 20 to 25 million in 2025. Stocks are on target. increase of more than 6%. There has been some confusion on the rise between AMC Networks and AMC Entertainment, Nathanson and others have noted, but there is also genuine excitement. AMC shares had already surged since its last quarterly report in November, Nathanson noted.

He thinks AMC Nets and others need to thank Disney.

“After a massive reassessment of growth stocks and Covid winners, this action [AMC Networks] – and many of their media peers – had been left for dead. Then, in December, after another successful Investor Day in which Disney laid out its DTC ambitions, the market’s complete shift to the sum of coins valuation methodology at Disney opened the door for investors. to try this approach on other companies.

Nathanson said that a “massive revaluation” of Roku also helped valuations. He called Roku’s action “essentially a game on AVOD and the long line of SVOD players trying to make money in space.” It rose nearly 5% on Monday with a market cap of $ 52 billion. “If it’s worth that much, what are Pluto, Tubi and Peacock worth?”

Also today, shares of ViacomCBS, the parent company of Pluto, rose 5% with the launch of Paramount + this week. Tubi owner Fox is up 5%. Lionsgate, which is streaming with Starz, is up about 7%.

Fubo is up 7% as he prepares to release his results on Tuesday.

It didn’t hurt Monday’s markets that Warren Buffett of Berkshire Hathaway, the 90-year-old known as Oracle of Omaha, urged this weekend in his much-studied annual letter to shareholders to ” never bet against America ”.

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