Discovery (NASDAQ:DISCA) was downgraded by Zacks Investment Research from a "hold" rating to a "strong sell" rating in a note issued to investors on Thursday, Zacks.com reports. They currently have a $44.00 price target on the stock. Zacks Investment Research's price target indicates a potential downside of 14.81% from the stock's previous close.
According to Zacks, "Discovery has been hit hard by the coronavirus-led disruption on advertising demand and spending. Its fourth-quarter 2020 results reflected sluggishness in the U.S. Networks’ advertising business. Further, incremental spending on direct-to-consumer initiatives and international business are likely to keep margins under pressure. Notably, higher selling, general and administrative expenses hurt profitability in the reported quarter. Its leveraged balance sheet remains a concern. Nevertheless, Discovery’s fourth-quarter results reflected recovery in advertising sending, primarily in the international markets. The company witnessed strong viewing share growth in the United Kingdom, Spain and Portugal. Additionally, its solid free cash flow generating ability boost investor confidence. Shares have outperformed the industry year to date."
DISCA has been the topic of a number of other research reports. Royal Bank of Canada upped their target price on Discovery from $35.00 to $40.00 and gave the company an "outperform" rating in a report on Wednesday, January 13th. MKM Partners reissued a "neutral" rating and set a $30.00 target price (up from $27.00) on shares of Discovery in a research report on Thursday, December 3rd. TheStreet upgraded Discovery from a "c" rating to a "b-" rating in a research report on Thursday, November 5th. Wells Fargo & Company lifted their price target on shares of Discovery from $42.00 to $65.00 and gave the stock an "overweight" rating in a research note on Tuesday. They noted that the move was a valuation call. Finally, Deutsche Bank Aktiengesellschaft boosted their target price on shares of Discovery from $30.00 to $35.00 and gave the company a "buy" rating in a research note on Friday, December 11th. Three research analysts have rated the stock with a sell rating, ten have issued a hold rating and seven have assigned a buy rating to the stock. The company currently has an average rating of "Hold" and an average target price of $36.29.
Shares of DISCA traded down $0.21 during midday trading on Thursday, hitting $51.65. The company had a trading volume of 216,190 shares, compared to its average volume of 10,171,521. The stock has a market cap of $25.36 billion, a price-to-earnings ratio of 25.20, a PEG ratio of 0.88 and a beta of 1.53. The company's 50 day moving average price is $41.55 and its 200 day moving average price is $28.40. The company has a quick ratio of 1.99, a current ratio of 1.99 and a debt-to-equity ratio of 1.29. Discovery has a 52 week low of $17.12 and a 52 week high of $56.02.
Discovery (NASDAQ:DISCA) last issued its earnings results on Sunday, February 21st. The company reported $0.76 EPS for the quarter, topping the consensus estimate of $0.72 by $0.04. Discovery had a return on equity of 20.76% and a net margin of 13.36%. The company had revenue of $2.88 billion during the quarter, compared to analyst estimates of $2.83 billion. During the same quarter last year, the firm earned $0.98 EPS. The business's revenue was up .3% on a year-over-year basis. Equities analysts anticipate that Discovery will post 3.17 EPS for the current fiscal year.
In other Discovery news, Director John C. Malone sold 550,000 shares of Discovery stock in a transaction that occurred on Thursday, December 3rd. The shares were sold at an average price of $28.61, for a total value of $15,735,500.00. Following the completion of the sale, the director now owns 787,359 shares of the company's stock, valued at approximately $22,526,340.99. The transaction was disclosed in a legal filing with the SEC, which is available at the SEC website. Company insiders own 5.88% of the company's stock.
A number of institutional investors have recently added to or reduced their stakes in DISCA. Meeder Asset Management Inc. raised its stake in Discovery by 30.9% during the 4th quarter. Meeder Asset Management Inc. now owns 1,110 shares of the company's stock valued at $33,000 after purchasing an additional 262 shares during the period. Carroll Financial Associates Inc. raised its holdings in shares of Discovery by 232.9% in the fourth quarter. Carroll Financial Associates Inc. now owns 1,112 shares of the company's stock worth $33,000 after buying an additional 778 shares during the period. Huntington National Bank purchased a new position in Discovery in the 4th quarter worth about $40,000. Vantage Consulting Group Inc bought a new stake in shares of Discovery during the fourth quarter valued at approximately $49,000. Finally, Fifth Third Bancorp lifted its holdings in shares of Discovery by 71.5% in the 3rd quarter. Fifth Third Bancorp now owns 1,758 shares of the company's stock worth $38,000 after buying an additional 733 shares during the period. 40.84% of the stock is owned by institutional investors.
Discovery, Inc operates as a media company in the United States and internationally. The company operates in two segments, U.S. Networks and International Networks. The company owns and operates various television networks under the Discovery Channel, TLC, Animal Planet, Investigation Discovery, Science Channel, MotorTrend, Food Network, HGTV, Travel Channel, TVN, DIY Network, Cooking Channel, Discovery Family Channel, American Heroes Channel, Destination America, Discovery Life, Discovery en Espanol, Discovery Familia, Great American Country, ID, the Oprah Winfrey Network, Eurosport, Discovery Kids, DMAX, and Discovery Home & Health brands, as well as other regional television networks.
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