Back to top

Analyst Blog

On Mar 18, 2014, we issued an updated research report on Grupo Televisa, S.A.B. (TV - Analyst Report). We anticipate that the recent regulatory reform in the Mexican telecommunications industry will affect the company’s operations. The new regulation will encourage other cable/satellite TV operators to enter the Mexican pay-TV market.

Grupo Televisa has delivered negative earnings surprise in the last three quarters out of four, with an average negative surprise of 8.9%. In the fourth quarter of fiscal 2013, the company reported mixed financial results. Earnings per GDS came in below the Zacks Consensus Estimate whereas net revenue outpaced the same.

Televisa currently dominates approximately 70% of the Mexican broadcasting and pay-TV market. The Federal Telecommunications Institute wants to restrict the maximum hold of a company in a market to 50%. Televisa also has to share its broadcast towers with competitors for a stipulated amount of fees.

The new telecommunications industry reform bill of the Mexican government will allow America Movil S.A.B. de C.V. (AMX - Analyst Report) to enter the broadcasting market of Mexico, which has been controlled by Televisa for a long time. This may substantially reduce Televisa’s advertisement revenues.

On the other hand, the new regulations may allow Televisa to capture a large chunk of the wireless market. In 2010, Televisa abandoned its wireless venture with Nextel de Mexico, a subsidiary of NII Holdings Inc. (NIHD - Analyst Report), owing to prolonged legal disputes.

Currently, the company holds a 50% stake in Grupo Iusacell, a small wireless operator of Mexico. However, Bloomberg reported that Telefonica S.A. (TEF - Analyst Report) is negotiating with Televisa and Grupo Salinasto, the remaining 50% stake holder of Iusacell, to acquire the company.

Grupo Televisa currently carries a Zacks Rank #5 (Strong Sell).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
UTD THERAPE… UTHR 117.83 +28.51%
TRIQUINT SE… TQNT 20.67 +6.52%
VASCO DATA… VDSI 14.77 +4.68%
BANCO DO BR… BDORY 15.53 +3.95%
STRATTEC SE… STRT 80.24 +3.00%