There’s a lot to be optimistic about in the Service sector as 2 experts just weighed in on AMC Networks Inc (NASDAQ: AMCX) and Amazon (NASDAQ: AMZN) with bullish sentimens.
AMC Networks Inc (NASDAQ: AMCX)
Albert Fried analyst Richard Tullo reiterated a Buy rating on AMC Networks (NASDAQ: AMCX) today and set a price target of $97. The company’s shares opened today at $59.22, close to its 52-week low of $54.81.
Tullo wrote, “We watch these indicators (COMBI) because since 2010 Combi has been strongly correlated to the US economic recovery. Overall growth GDP was weak in last six months, under 2% for US GDP. While each industry is unique, media owing to its linkage to Auto and CPG advertisers is correlated to GDP. While we are concerned about technology but ultimately OTT is for TV. OTT is good if CEO’s make decisions based on the long term catalog value rather than short term revenue. We are more concerned with Social Video taking share from news and the TV schedule. We think VOD (SVOD and VOD) add to the aggregate TV audience. However our view is; if social video takes digital mind share thus Ad share from TV then the source of value creation shifts to Facebook (FB, NC). When users share videos it’s engaging because our “friends” send videos to us and unlike Twitter posts Social Video detracts from TV viewing. However despite tech pressure AMC is well positioned. We like AMCX’s smaller scale because the Company does not have the multi-billion dollar legacy costs of its competitors; Disney (DIS, NC) operates +/-19 TV networks. AMACX’s programming budget is a 10 th of the budget as Netflix (NFLX, NC) and makes more money defined as FCF and EPS. We agree with Reed Hastings, the Netflix CEO, AMCX is well positioned in terms of brand and content to launch an OTT network.”
According to TipRanks.com, Tullo is a 4-star analyst with an average return of 3.6% and a 53.3% success rate. Tullo covers the Services sector, focusing on stocks such as Interpublic Group of Companies, Live Nation Entertainment, and Madison Square Garden Co.
AMC Networks has an analyst consensus of Moderate Buy, with a price target consensus of $79
.
Amazon (NASDAQ: AMZN)
In a report released today, Gene Munster from Piper Jaffray reiterated a Buy rating on Amazon (NASDAQ: AMZN), with a price target of $800. The company’s shares opened today at $756.86.
According to TipRanks.com, Munster is a top 25 analyst with an average return of 16.4% and a 61.8% success rate. Munster covers the Technology sector, focusing on stocks such as Angie’s List Inc., Digital River, and Web.com Group.
Currently, the analyst consensus on Amazon is Strong Buy and the average price target is $826.44, representing a 9.2% upside.
In a report issued on June 27, Jefferies also reiterated a Buy rating on the stock with a $865 price target.
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