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The Zacks Analyst Blog Highlights: Amazon, Disney, 21st Century Fox, Twitter and Netflix
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For Immediate Release
Chicago, IL – November 21, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Amazon (AMZN - Free Report) , Disney (DIS - Free Report) , 21st Century Fox (FOXA - Free Report) , Twitter and Netflix (NFLX - Free Report) .
Amazon’s Bid for Disney Sports Networks: Could It Help Beat Netflix?
Amazon looks like it could be the beneficiary of the fact that Disney was forced to divest 21st Century Fox’s nearly two dozen regional sports networks as part of its $71.3 billion deal to purchase key Fox entertainment assets. The e-commerce powerhouse reportedly bid for all 22 networks, which include channels in New York and Los Angeles, and highlights Amazon’s ambition to be a streaming sports giant.
Regional Sports Networks
Amazon bid for Fox’s 22 regional sports TV networks that Disney acquired in its deal, according to a CNBC report Tuesday. The 22 networks include New York-based YES Network, which is the New York Yankees’ television home, along with other major cities throughout the U.S.
Amazon was not alone in its pursuit of Fox’s regional sports networks. Apollo Global Management, KKR & Co, The Blackstone Group, Sinclair Broadcast Group, and others made first-round bids. On top of that, the “New Fox,” which will be made up mostly of the Fox broadcast network and Fox News Channel, is also said to be in the running for the channels. Second round bids are expected to be submitted before the end of the year.
Jeff Bezos’ firm clearly seems committed to spend big to continue to pursue a sports-filled future since Guggenheim Securities valued the regional networks at $25 billion. Yet, Disney was forced to pay a premium for the Fox assets after Comcast drove up the price. This means that Fox’s RSNs could eventually fetch less on the open market.
Amazon & Sports
Amazon dove into live streaming sports in a big way last year when it outbid other tech firms for the rights to stream NFL Thursday Night Football games. The cloud computing giant took over from Twitter after it paid $10 million to stream TNF for the first time during the 2016 season.
Bezos’ company signed a new, two-year TNF contract in the offseason. The deal is said to be worth about 30% more than the original one-year deal per season, which puts it at roughly $130 million total.
Amazon Prime subscribers can stream at no extra cost 11 TNF games for both the 2018 and 2019 seasons, which are also broadcast by Fox on linear TV. Amazon and the NFL also allow Twitch users to live-stream these games for free, as both parties experiment with what might work best down the road.
On top of being part of by far the most popular sport in the U.S., Amazon has jumped into live tennis. More importantly, Amazon this summer won the exclusive rights for Premier League soccer games in the UK starting in the 2019 season. The three-year deal will see Amazon Prime live stream the first December midweek round and the festive bank holiday round of games, for a total of 20 games a season.
Amazon’s deal to stream the most lucrative soccer league in the world live in the UK, at no extra cost to users, is significant and could be a sign of much larger deals to come. The U.S. e-commerce firm beat out Sky Sports and BT Sport, which have come to dominate Premier League coverage. For the non-soccer fans out there, imagine if a UK-based streaming service bought the exclusive rights to broadcast the NBA’s Christmas Day games or the NFL’s Thanksgiving games.
Along with streaming live games, Amazon rolled out its first sports documentary series in 2016 under its All or Nothing banner. The Emmy-winning series has covered multiple NFL teams throughout the entire season since then, along with the Michigan Wolverines football team, as well as Manchester City—one of the biggest soccer teams in the world—and more.
Bottom Line
The streaming TV age is already upon us and the cord-cutting revolution rages on. For instance, more than 1 million consumers canceled their cable-TV or satellite subscriptions in the past quarter alone, which was one of the largest seasonal declines ever. Netflix, Hulu and Amazon have all been some of the beneficiaries of this shift.
It is worth remembering that Amazon last said it had more than 100 million Prime subscribers worldwide. Meanwhile, Netflix ended the quarter with 137.1 million subscribers. But Amazon saw its quarterly revenues jump 29% to $56.6 billion, while Netflix’s Q3 revenues surged 34% to hit $3.99 billion.
Therefore, Amazon’s ability to offer streaming movies, TV, and live sports, not to mention its shipping deals, could help it come out on top of the battle for streaming supremacy. And let’s not forget that advertisers are likely to flock to live sports more than ever as consumers spend more time on non-ad supported services like Netflix and Spotify.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Amazon, Disney, 21st Century Fox, Twitter and Netflix
For Immediate Release
Chicago, IL – November 21, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Amazon (AMZN - Free Report) , Disney (DIS - Free Report) , 21st Century Fox (FOXA - Free Report) , Twitter and Netflix (NFLX - Free Report) .
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Tuesday’s Analyst Blog:
Amazon’s Bid for Disney Sports Networks: Could It Help Beat Netflix?
Amazon looks like it could be the beneficiary of the fact that Disney was forced to divest 21st Century Fox’s nearly two dozen regional sports networks as part of its $71.3 billion deal to purchase key Fox entertainment assets. The e-commerce powerhouse reportedly bid for all 22 networks, which include channels in New York and Los Angeles, and highlights Amazon’s ambition to be a streaming sports giant.
Regional Sports Networks
Amazon bid for Fox’s 22 regional sports TV networks that Disney acquired in its deal, according to a CNBC report Tuesday. The 22 networks include New York-based YES Network, which is the New York Yankees’ television home, along with other major cities throughout the U.S.
Amazon was not alone in its pursuit of Fox’s regional sports networks. Apollo Global Management, KKR & Co, The Blackstone Group, Sinclair Broadcast Group, and others made first-round bids. On top of that, the “New Fox,” which will be made up mostly of the Fox broadcast network and Fox News Channel, is also said to be in the running for the channels. Second round bids are expected to be submitted before the end of the year.
Jeff Bezos’ firm clearly seems committed to spend big to continue to pursue a sports-filled future since Guggenheim Securities valued the regional networks at $25 billion. Yet, Disney was forced to pay a premium for the Fox assets after Comcast drove up the price. This means that Fox’s RSNs could eventually fetch less on the open market.
Amazon & Sports
Amazon dove into live streaming sports in a big way last year when it outbid other tech firms for the rights to stream NFL Thursday Night Football games. The cloud computing giant took over from Twitter after it paid $10 million to stream TNF for the first time during the 2016 season.
Bezos’ company signed a new, two-year TNF contract in the offseason. The deal is said to be worth about 30% more than the original one-year deal per season, which puts it at roughly $130 million total.
Amazon Prime subscribers can stream at no extra cost 11 TNF games for both the 2018 and 2019 seasons, which are also broadcast by Fox on linear TV. Amazon and the NFL also allow Twitch users to live-stream these games for free, as both parties experiment with what might work best down the road.
On top of being part of by far the most popular sport in the U.S., Amazon has jumped into live tennis. More importantly, Amazon this summer won the exclusive rights for Premier League soccer games in the UK starting in the 2019 season. The three-year deal will see Amazon Prime live stream the first December midweek round and the festive bank holiday round of games, for a total of 20 games a season.
Amazon’s deal to stream the most lucrative soccer league in the world live in the UK, at no extra cost to users, is significant and could be a sign of much larger deals to come. The U.S. e-commerce firm beat out Sky Sports and BT Sport, which have come to dominate Premier League coverage. For the non-soccer fans out there, imagine if a UK-based streaming service bought the exclusive rights to broadcast the NBA’s Christmas Day games or the NFL’s Thanksgiving games.
Along with streaming live games, Amazon rolled out its first sports documentary series in 2016 under its All or Nothing banner. The Emmy-winning series has covered multiple NFL teams throughout the entire season since then, along with the Michigan Wolverines football team, as well as Manchester City—one of the biggest soccer teams in the world—and more.
Bottom Line
The streaming TV age is already upon us and the cord-cutting revolution rages on. For instance, more than 1 million consumers canceled their cable-TV or satellite subscriptions in the past quarter alone, which was one of the largest seasonal declines ever. Netflix, Hulu and Amazon have all been some of the beneficiaries of this shift.
It is worth remembering that Amazon last said it had more than 100 million Prime subscribers worldwide. Meanwhile, Netflix ended the quarter with 137.1 million subscribers. But Amazon saw its quarterly revenues jump 29% to $56.6 billion, while Netflix’s Q3 revenues surged 34% to hit $3.99 billion.
Therefore, Amazon’s ability to offer streaming movies, TV, and live sports, not to mention its shipping deals, could help it come out on top of the battle for streaming supremacy. And let’s not forget that advertisers are likely to flock to live sports more than ever as consumers spend more time on non-ad supported services like Netflix and Spotify.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.