Wall St. Speaks Out: Groundhog Day for TV Advertising - Pivotal Research
By: Brian Wieser
Monday is Groundhog Day, which seems as good a time as any to ponder the year ahead for owners of media properties focused on national TV advertising sales. Will the shadow of weak recent results for advertising loom large in the year ahead and result in a demoralizing repeat of 2014 for sellers of TV ad inventory? Or will the cyclical nature of marketing mean that new budgets – if not new marketers – allow the industry to break free of last year's trends to witness a flowering of growth once again?
Wall St. Speaks Out on FB, Google, Twitter & Yahoo - Pivotal Research
By: Brian Wieser
Price target changes were primarily a function of changes to costs of capital embedded in our models which we have incorporated across our coverage universe. In our valuation framework, lower long-term costs of capital (driven at this time by falling yields on long-term treasury bonds) disproportionately impact companies whose stock prices are disproportionately dependent upon their terminal values. Each of Facebook, Google, Twitter and Salesforce.com remain as Buy-rated. We continue to rate Yahoo Hold, although we note that a majority of its value is dependent upon the value of Alibaba.
Wall St. Speaks Out on Mobile Marketing: Still Early Innings for Brands - Pivotal Research
By: Brian Wieser
For well over a decade, many pundits and practitioners within the advertising industry would claim that "next year is the year of mobile advertising." Over the past two years a case could be made that the year for mobile advertising finally arrived. As an increasing share of advertisements running on Facebook, Twitter and Google are executed on mobile devices, it is technically true that mobile advertising is growing rapidly, as each of these companies capture a growing share of digital media budgets.
Wall St Speaks Out on Netflix OTT, Roku 4K, Facebook Video & DVD Sales - Janney/MediaEntertainment
By: Tony Wible
NFLX usage is increasing, with 36% of subs using the service daily in 2014, and 72% using it weekly, according to Leichtman Research Group. Usage has increased since 2010 when only 10% streamed daily and 43% weekly, although this is likely mostly driven by the amount of content now available. We suspect that the increased amount of children's content is also a driver. Daily usage is slightly lower for subs that also subscribe to pay TV (32%). Penetration among pay TV subs is 36%, and 48% among non-pay TV subs, implying that consumers substitute the two services. We believe that the pay TV subscriber base will continue to face pressure from on-demand alternatives, including SVOD and online video.
Wall St. Speaks Out on Network TV Market Activity - RBC Capital Markets, LLC
By: David Bank
Network TV Channel Checks Incrementally Positive – We have completed a number of discussions with influential ad buyers and sellers in the Network TV space this week. We come away from them encouraged that activity has perked up in the market place over the past two weeks and some pricing power for sellers has followed.
Wall St Speaks Out on CES Take-Aways - Barclays
By: Chris Merwin
We attended the CES conference in Las Vegas this week and while a lot was the same as past years – IoT, connected cars, 4k, etc. – a few things were different. Virtual Reality, and in particular Oculus, seemed to be a bigger focus this year, as did all types of robotics, like drones. In addition to touring the showroom floor, we attended several panels on emerging trends in advertising and gaming. Advertising panelists seemed to be in agreement that a lot of marketers and agencies still have a lot to learn when it comes to building a brand in an increasingly digital world where consumer behavioral patterns are constantly changing. It seems clear, however, that more brand advertising dollars need to shift online to the largest publishers like FB (covered by Paul Vogel / Overweight), commensurate with the audience migration that has already taken place. For the gaming industry, panelists had mixed views on whether or not there will be another console cycle, but either way, we think the increasing number of distribution formats, like mobile, should be a positive for the largest game publishers
Wall St. Speaks Out on the Worst Christmas Gift Ever
By: Brian Wieser
The recent hack of Sony's IT systems has been one of the most important news items related to the media industry – and industries of all kinds – for many years. The implications of this event for Sony alone are significant of course, ranging from the effect on the box office outcomes for several films to the future relationships its executives have with employees and other industry partners. Unfortunately for them, the damage from the attack will continue to play out in slow motion for the company and for the employees whose personal information was divulged. However, for as bad as this news is, there are even bigger issues to consider which relate to the forced transparency of the inner-workings of individual companies.