We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Media Conglomerates industry is flourishing, driven by the consumer shift toward over-the-top (OTT) content. Major players like Sphere Entertainment Co. (SPHR - Free Report) , Lionsgate Studios Corp. (LION - Free Report) and Madison Square Garden Entertainment Corp. (MSGE - Free Report) are aggressively investing in developing original music, shows and fresh content to captivate and retain Gen Z and millennial subscribers. Moreover, the industry's prospects are bolstered by the availability of cost-effective alternative packages, such as skinny bundles, designed to entice consumers with lower prices compared to traditional offerings. Conversely, the industry grapples with waning broadcast television ratings and diminishing demand for home entertainment sales of theatrical content. Furthermore, advertisers' tepid spending amid rampant inflation and elevated interest rates poses a formidable concern for industry players.
Industry Description
The Zacks Media Conglomerates industry encompasses companies engaged in creating and distributing various content forms, from entertainment to educational materials. These firms also offer travel and consumer products. The industry is adapting to the shift toward OTT content, both subscription-based and ad-supported. Advertising remains a key revenue source, while the metaverse presents new opportunities. Subscription price increases, driven by growing subscriber numbers, offer potential revenue growth. However, the industry faces challenges that include declining broadcast TV ratings, reduced demand for home entertainment versions of theatrical releases, and increasing cord-cutting trends. Despite these obstacles, media conglomerates continue to evolve, leveraging new technologies and consumer preferences to maintain their market position.
3 Trends Shaping the Future of the Media Industry
Original Content Driving Growth: Media companies' capacity to generate advertising revenues beyond traditional TV platforms, such as websites and other digitally consumed channels, unlocks increased opportunities for targeted advertising. The growing consumer preference for subscription services over linear pay-TV and rental or outright purchases has compelled industry players to adapt their business models. Media companies are innovating with original content to attract and retain subscribers.
High-Speed Internet Demand Acting as a Key Catalyst: The burgeoning demand for high-speed Internet, including broadband, has benefited media industry participants. Improving Internet speed has fueled the demand for high-quality videos and the trend of binge-watching. Furthermore, a strengthening broadband ecosystem in international markets, coupled with the proliferation of smart TVs, is expected to drive growth.
Cord-Cutting and Matured PayTV Industry Hurting Prospects: The media television industry is undergoing a rapid evolution of distribution platforms, embracing new players and advanced technologies. The declining profitability of residential video services due to rising programming costs and retransmission fees has made survival challenging for traditional companies. Additionally, the heightened demand for on-demand content has led to the mushrooming of streaming service providers, making it increasingly difficult for traditional media television companies to maintain their viewer base.
Zacks Industry Rank Indicates Bright Prospects
The Zacks Media Conglomerates industry is housed within the broader Zacks Consumer Discretionary sector. It carries a Zacks Industry Rank #93, which places it in the top 38% of more than 245 Zacks industries.
The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates continued outperformance in the near term. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are optimistic about this group’s earnings growth potential.
Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms the Sector, S&P 500
The Zacks Media Conglomerates industry has underperformed the broader Zacks Consumer Discretionary sector and the S&P 500 composite over the past year.
The industry has declined 1.4% in the abovementioned period against no change for the broader sector. The S&P 500 has risen 17.3% during the same time frame.
One-Year Price Performance
Industry's Current Valuation
On the basis of the trailing 12-month P/S, a commonly used multiple for valuing media companies, we see that the industry is currently trading at 1.52X compared with the S&P 500’s 6.08X and the sector’s 2.39X.
Over the past five years, the industry has traded as high as 2.93X and as low as 1.15X, with a median of 1.52X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
3 Media Stocks to Buy
Sphere Entertainment: This Zacks Rank #2 (Buy) company presents compelling investment potential for 2026, driven by multiple growth catalysts. The Wizard of Oz Experience has exceeded two million tickets sold, demonstrating sustained revenue generation from original content. Strategic partnerships secured in January 2026 with Delta Air Lines as official airline partner and the December PwC sponsorship agreement strengthen recurring sponsorship revenue streams. The announced National Harbor expansion marks the first smaller-scale Sphere design, enabling geographic diversification and capital-efficient growth beyond Las Vegas. With December's appointment of an experienced Chief Technology Officer, the company strengthens operational capabilities while Sphere's ranking as the top-grossing venue globally validates its unique market position for 2026 growth. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for the company’s 2026 bottom line is pegged at a loss of $3.41 per share, narrower by 26 cents over the past 30 days. SPHR shares have risen 105.1% in the past six-month period.
Price and Consensus: SPHR
Lionsgate Studios: This Zacks Rank #2 company is benefiting from strategic initiatives that position the company for robust growth. The December 2025 exclusive partnership with FreeWheel substantially expands advertising revenue potential across nearly 30 premium FAST channels in the United States, tapping into the rapidly growing free ad-supported streaming market. With more than 40 FAST channels operating globally, including the flagship MovieSphere, Lionsgate is capitalizing on shifting consumer preferences toward ad-supported content. The company's extensive content library generated record trailing twelve-month revenue of $989 million, reflecting a 12% increase and strong monetization capabilities. As a standalone pure-play content company following the Starz separation, Lionsgate benefits from operational focus and flexibility to maximize its 20,000-plus title library across multiple distribution platforms, positioning shareholders for sustainable value creation in 2026.
The Zacks Consensus Estimate for the company’s fiscal 2026 earnings has moved north by 8.3% to 26 cents per share over the past 30 days. LION shares have returned 47.9% in the past six-month period.
Price and Consensus: LION
Madison Square Garden Entertainment: This Zacks Rank #2 company continues building momentum backed by strong financial performance and strategic positioning. The 2025 Christmas Spectacular achieved record-breaking attendance with 1.2 million tickets sold across 216 performances, marking the highest turnout in 25 years and demonstrating sustained consumer demand for premium live entertainment. The December partnership with Cisco strengthens venue infrastructure capabilities, while the new Sphere Immersive Sound technology at Radio City Music Hall creates differentiated concert experiences that should drive premium pricing power and artist bookings. Management's active capital allocation through share repurchases signals confidence in operational execution. The combination of proven flagship productions, enhanced venue technology creating competitive advantages, strategic partnerships supporting scalable experiences, and record concert activity at Madison Square Garden Arena establishes multiple revenue drivers.
The Zacks Consensus Estimate for the company’s fiscal 2026 earnings has moved north by 1.9% to $2.20 per share over the past 30 days. MSGE shares have returned 43.9% in the past six-month period.
Price and Consensus: MSGE
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
3 Media Stocks to Buy From a Prospering Industry
The Zacks Media Conglomerates industry is flourishing, driven by the consumer shift toward over-the-top (OTT) content. Major players like Sphere Entertainment Co. (SPHR - Free Report) , Lionsgate Studios Corp. (LION - Free Report) and Madison Square Garden Entertainment Corp. (MSGE - Free Report) are aggressively investing in developing original music, shows and fresh content to captivate and retain Gen Z and millennial subscribers. Moreover, the industry's prospects are bolstered by the availability of cost-effective alternative packages, such as skinny bundles, designed to entice consumers with lower prices compared to traditional offerings. Conversely, the industry grapples with waning broadcast television ratings and diminishing demand for home entertainment sales of theatrical content. Furthermore, advertisers' tepid spending amid rampant inflation and elevated interest rates poses a formidable concern for industry players.
Industry Description
The Zacks Media Conglomerates industry encompasses companies engaged in creating and distributing various content forms, from entertainment to educational materials. These firms also offer travel and consumer products. The industry is adapting to the shift toward OTT content, both subscription-based and ad-supported. Advertising remains a key revenue source, while the metaverse presents new opportunities. Subscription price increases, driven by growing subscriber numbers, offer potential revenue growth. However, the industry faces challenges that include declining broadcast TV ratings, reduced demand for home entertainment versions of theatrical releases, and increasing cord-cutting trends. Despite these obstacles, media conglomerates continue to evolve, leveraging new technologies and consumer preferences to maintain their market position.
3 Trends Shaping the Future of the Media Industry
Original Content Driving Growth: Media companies' capacity to generate advertising revenues beyond traditional TV platforms, such as websites and other digitally consumed channels, unlocks increased opportunities for targeted advertising. The growing consumer preference for subscription services over linear pay-TV and rental or outright purchases has compelled industry players to adapt their business models. Media companies are innovating with original content to attract and retain subscribers.
High-Speed Internet Demand Acting as a Key Catalyst: The burgeoning demand for high-speed Internet, including broadband, has benefited media industry participants. Improving Internet speed has fueled the demand for high-quality videos and the trend of binge-watching. Furthermore, a strengthening broadband ecosystem in international markets, coupled with the proliferation of smart TVs, is expected to drive growth.
Cord-Cutting and Matured PayTV Industry Hurting Prospects: The media television industry is undergoing a rapid evolution of distribution platforms, embracing new players and advanced technologies. The declining profitability of residential video services due to rising programming costs and retransmission fees has made survival challenging for traditional companies. Additionally, the heightened demand for on-demand content has led to the mushrooming of streaming service providers, making it increasingly difficult for traditional media television companies to maintain their viewer base.
Zacks Industry Rank Indicates Bright Prospects
The Zacks Media Conglomerates industry is housed within the broader Zacks Consumer Discretionary sector. It carries a Zacks Industry Rank #93, which places it in the top 38% of more than 245 Zacks industries.
The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates continued outperformance in the near term. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are optimistic about this group’s earnings growth potential.
Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms the Sector, S&P 500
The Zacks Media Conglomerates industry has underperformed the broader Zacks Consumer Discretionary sector and the S&P 500 composite over the past year.
The industry has declined 1.4% in the abovementioned period against no change for the broader sector. The S&P 500 has risen 17.3% during the same time frame.
One-Year Price Performance
Industry's Current Valuation
On the basis of the trailing 12-month P/S, a commonly used multiple for valuing media companies, we see that the industry is currently trading at 1.52X compared with the S&P 500’s 6.08X and the sector’s 2.39X.
Over the past five years, the industry has traded as high as 2.93X and as low as 1.15X, with a median of 1.52X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
3 Media Stocks to Buy
Sphere Entertainment: This Zacks Rank #2 (Buy) company presents compelling investment potential for 2026, driven by multiple growth catalysts. The Wizard of Oz Experience has exceeded two million tickets sold, demonstrating sustained revenue generation from original content. Strategic partnerships secured in January 2026 with Delta Air Lines as official airline partner and the December PwC sponsorship agreement strengthen recurring sponsorship revenue streams. The announced National Harbor expansion marks the first smaller-scale Sphere design, enabling geographic diversification and capital-efficient growth beyond Las Vegas. With December's appointment of an experienced Chief Technology Officer, the company strengthens operational capabilities while Sphere's ranking as the top-grossing venue globally validates its unique market position for 2026 growth. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for the company’s 2026 bottom line is pegged at a loss of $3.41 per share, narrower by 26 cents over the past 30 days. SPHR shares have risen 105.1% in the past six-month period.
Price and Consensus: SPHR
Lionsgate Studios: This Zacks Rank #2 company is benefiting from strategic initiatives that position the company for robust growth. The December 2025 exclusive partnership with FreeWheel substantially expands advertising revenue potential across nearly 30 premium FAST channels in the United States, tapping into the rapidly growing free ad-supported streaming market. With more than 40 FAST channels operating globally, including the flagship MovieSphere, Lionsgate is capitalizing on shifting consumer preferences toward ad-supported content. The company's extensive content library generated record trailing twelve-month revenue of $989 million, reflecting a 12% increase and strong monetization capabilities. As a standalone pure-play content company following the Starz separation, Lionsgate benefits from operational focus and flexibility to maximize its 20,000-plus title library across multiple distribution platforms, positioning shareholders for sustainable value creation in 2026.
The Zacks Consensus Estimate for the company’s fiscal 2026 earnings has moved north by 8.3% to 26 cents per share over the past 30 days. LION shares have returned 47.9% in the past six-month period.
Price and Consensus: LION
Madison Square Garden Entertainment: This Zacks Rank #2 company continues building momentum backed by strong financial performance and strategic positioning. The 2025 Christmas Spectacular achieved record-breaking attendance with 1.2 million tickets sold across 216 performances, marking the highest turnout in 25 years and demonstrating sustained consumer demand for premium live entertainment. The December partnership with Cisco strengthens venue infrastructure capabilities, while the new Sphere Immersive Sound technology at Radio City Music Hall creates differentiated concert experiences that should drive premium pricing power and artist bookings. Management's active capital allocation through share repurchases signals confidence in operational execution. The combination of proven flagship productions, enhanced venue technology creating competitive advantages, strategic partnerships supporting scalable experiences, and record concert activity at Madison Square Garden Arena establishes multiple revenue drivers.
The Zacks Consensus Estimate for the company’s fiscal 2026 earnings has moved north by 1.9% to $2.20 per share over the past 30 days. MSGE shares have returned 43.9% in the past six-month period.
Price and Consensus: MSGE