Sky Deutschland in bank’s Top 5 picks for 2013
Investment banker Morgan Stanley, in its annual look back and forecast report, cited European media as a strong performer for 2013, and which – excluding Vivendi – outperformed the general market by more than 20 points.
“Our top 5 is characterised by selective exposure to continued cyclical upturn but also by structural, corporate and cash return potential. Our top five is TF1, ITV, RTL, Reed Elsevier and Sky-D,” says the bank. However, the bank’s report has a similar list of those businesses which are less favoured for the new year. “Typified by structural challenges with Pearson managing its print migration; BSkyB facing a new pay TV contender and for SES the threat of overcapacity. Mediaset Espana is structurally attractive but the rating has overshot and we think the pace of the advertising upturn will be more gradual than the market expects.”
Morgan Stanley talks extensively of Europe’s two satellite operators, Eutelsat and SES, saying: “Our analysis suggests overcapacity could be a more serious issue than the industry is expecting. We calculate the proliferation of traditional satellite launches coupled with the rollout of High Throughput Satellite could increase the total marketable transponder capacity globally by up to 75 per cent by 2016. We think the risk that HTS, which have a more powerful and cost-effective technology than traditional satellites, drive price deflation in data (c.30 per cent of sales) could be greater than consensus expects.”