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4 Media Stocks That Are Worth Watching in a Challenging Industry
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The Zacks Media Conglomerates industry has been grappling 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. Conversely, industry players are reaping the benefits of consumer shift toward over-the-top (OTT) content. Major players like Disney (DIS - Free Report) , Madison Square Garden Entertainment Corp. (MSGE - Free Report) , People Incorporated (PPLI - Free Report) and Reservoir Media (RSVR - 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.
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 Dull Prospects
The Zacks Media Conglomerates industry is housed within the broader Zacks Consumer Discretionary sector. It carries a Zacks Industry Rank #176, which places it in the bottom 29% 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 underperformance 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 bottom 50% of the Zacks-ranked industries results from a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are pessimistic about this group’s earnings growth potential. Since Sept. 30, 2025, the industry’s earnings estimates for 2026 have moved down by 3.1%.
Despite the gloomy industry outlook, a few stocks are worth watching, as these have the potential to outperform the market based on a strong earnings outlook. But before we present such stocks, it is worth first looking at the industry’s shareholder returns and current valuation.
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 Outperforms the Sector, Lags S&P 500
The Zacks Media Conglomerates industry has outperformed the broader Zacks Consumer Discretionary sector but lagged the S&P 500 composite over the past year.
The industry has declined 16.4% in the abovementioned period compared with a 19.2% drop in the broader sector. The S&P 500 has risen 15.6% 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 1.27X compared with the S&P 500’s 5.86X and the sector’s 2.06X.
Over the past five years, the industry has traded as high as 2.97X and as low as 1.15X, with a median of 1.47X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
4 Media Stocks to Watch
Madison Square Garden Entertainment is well-positioned for near-term momentum, anchored by strong fundamentals and a robust catalyst pipeline. Fiscal 2026 revenues grew 13% to $1.06 billion, with adjusted operating income up 18% to $262.2 million. Management has guided for solid growth in fiscal 2027. The upcoming Christmas Spectacular — expanded to a record 230 performances — signals deepening monetization of this flagship franchise. Harry Styles' 30-show residency at The Garden adds near-term booking density through October 2026. A $25 million share repurchase in September, which brought the total capital returned to ~$230 million since the 2023 spinoff, reflects management's conviction. The appointment of Josephine Vaccarello as president adds operational leadership focused on expanding the event calendar and identifying growth opportunities.
The Zacks Consensus Estimate for this Zacks Rank #1 (Strong Buy) company’s fiscal 2027 earnings has moved north by 6.4% to $2.5 per share over the past 60 days. MSGE shares have returned 38.3% in the past six-month period. You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: MSGE
People Incorporated is positioned for near-term momentum across multiple fundamental drivers. Its publishing unit, People Inc., posted eleven consecutive quarters of digital revenue growth, with management guiding for mid-to-high single-digit digital revenues and adjusted EBITDA expansion through full-year 2026. Emerging non-session-based revenue streams — including AI content licensing and the D/Cipher+ advertising platform — are scaling rapidly, diversifying the revenue base from Google-search traffic dependency.
A refreshed leadership team that took effect in August 2026 accompanies a corporate consolidation targeting annual run-rate operating expenses of approximately $45 million by first-quarter fiscal 2027. With $1.1 billion in cash, a $3 billion MGM Resorts equity stake, a pending ~$189 million LP asset sale, and a 12.5-million-share repurchase authorization, the fundamental setup appears constructive.
The Zacks Consensus Estimate for this Zacks Rank #1 company’s fiscal 2027 bottom line is pegged at $6.10 per share. PPLI shares have risen 2.7% in the past six-month period.
Price and Consensus: PPLI
The Walt Disney Company is executing a decisive technology transformation. In September, Disney appointed Karandeep Anand — former CEO of Character.AI — as chief technology officer, a newly created role unifying AI, infrastructure, and data platforms company-wide. Concurrently, Adam Smith's elevation to chairman of Direct-to-Consumer intensifies focus on Disney+ as the central fan hub, with expanded advertising technology oversight. Disney Ad Creative Studio's July closed beta introduces AI-powered connected TV ad generation, unlocking new advertiser revenues. August's beta launch of AI-powered search on Disney+ and ESPN strengthens discovery and engagement. The 2026 Disney Accelerator, focused on robotics, generative AI, and data synthesis, reinforces a technology-led growth mandate, making DIS a constructive near-term investment.
The Zacks Consensus Estimate for this Zacks Rank #3 (Hold) company’s fiscal 2026 earnings has moved north by 1.2% to $6.91 per share over the past 60 days. DIS shares have returned 10% in the past six-month period.
Price and Consensus: DIS
Reservoir Media is advancing a global expansion strategy with compelling fundamental momentum. In July 2026, the company deepened its Latin music presence by acquiring Nacional Records' catalog and publishing arm, Canciones Nacionales, alongside a joint venture to develop Latin artists and songwriters. In August, PopIndia acquired Chennai-based Vincey Productions' catalog, including 10 million YouTube subscribers, and signed India-based hip-hop producer 30KEY! for a publishing deal. On Sept. 30, Reservoir announced a publishing deal with Diamond-selling, Grammy-nominated songwriter-producer Jake Sinclair, plus a joint venture to develop emerging talent. First-quarter fiscal 2027 results showed 12% revenue growth to $41.5 million and a 13% adjusted EBITDA expansion. The company's fiscal 2027 guidance calls for mid-single-digit top- and bottom-line growth, supporting continued momentum.
The Zacks Consensus Estimate for this Zacks Rank #3 company’s fiscal 2027 earnings has remained steady at 13 cents per share over the past 60 days. RSVR shares have declined 2.1% in the past six-month period.
View the Zacks #1 Rank List
Image: Bigstock
4 Media Stocks That Are Worth Watching in a Challenging Industry
The Zacks Media Conglomerates industry has been grappling 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. Conversely, industry players are reaping the benefits of consumer shift toward over-the-top (OTT) content. Major players like Disney (DIS - Free Report) , Madison Square Garden Entertainment Corp. (MSGE - Free Report) , People Incorporated (PPLI - Free Report) and Reservoir Media (RSVR - 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.
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 Dull Prospects
The Zacks Media Conglomerates industry is housed within the broader Zacks Consumer Discretionary sector. It carries a Zacks Industry Rank #176, which places it in the bottom 29% 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 underperformance 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 bottom 50% of the Zacks-ranked industries results from a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are pessimistic about this group’s earnings growth potential. Since Sept. 30, 2025, the industry’s earnings estimates for 2026 have moved down by 3.1%.
Despite the gloomy industry outlook, a few stocks are worth watching, as these have the potential to outperform the market based on a strong earnings outlook. But before we present such stocks, it is worth first looking at the industry’s shareholder returns and current valuation.
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 Outperforms the Sector, Lags S&P 500
The Zacks Media Conglomerates industry has outperformed the broader Zacks Consumer Discretionary sector but lagged the S&P 500 composite over the past year.
The industry has declined 16.4% in the abovementioned period compared with a 19.2% drop in the broader sector. The S&P 500 has risen 15.6% 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 1.27X compared with the S&P 500’s 5.86X and the sector’s 2.06X.
Over the past five years, the industry has traded as high as 2.97X and as low as 1.15X, with a median of 1.47X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
4 Media Stocks to Watch
Madison Square Garden Entertainment is well-positioned for near-term momentum, anchored by strong fundamentals and a robust catalyst pipeline. Fiscal 2026 revenues grew 13% to $1.06 billion, with adjusted operating income up 18% to $262.2 million. Management has guided for solid growth in fiscal 2027. The upcoming Christmas Spectacular — expanded to a record 230 performances — signals deepening monetization of this flagship franchise. Harry Styles' 30-show residency at The Garden adds near-term booking density through October 2026. A $25 million share repurchase in September, which brought the total capital returned to ~$230 million since the 2023 spinoff, reflects management's conviction. The appointment of Josephine Vaccarello as president adds operational leadership focused on expanding the event calendar and identifying growth opportunities.
The Zacks Consensus Estimate for this Zacks Rank #1 (Strong Buy) company’s fiscal 2027 earnings has moved north by 6.4% to $2.5 per share over the past 60 days. MSGE shares have returned 38.3% in the past six-month period. You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: MSGE
People Incorporated is positioned for near-term momentum across multiple fundamental drivers. Its publishing unit, People Inc., posted eleven consecutive quarters of digital revenue growth, with management guiding for mid-to-high single-digit digital revenues and adjusted EBITDA expansion through full-year 2026. Emerging non-session-based revenue streams — including AI content licensing and the D/Cipher+ advertising platform — are scaling rapidly, diversifying the revenue base from Google-search traffic dependency.
A refreshed leadership team that took effect in August 2026 accompanies a corporate consolidation targeting annual run-rate operating expenses of approximately $45 million by first-quarter fiscal 2027. With $1.1 billion in cash, a $3 billion MGM Resorts equity stake, a pending ~$189 million LP asset sale, and a 12.5-million-share repurchase authorization, the fundamental setup appears constructive.
The Zacks Consensus Estimate for this Zacks Rank #1 company’s fiscal 2027 bottom line is pegged at $6.10 per share. PPLI shares have risen 2.7% in the past six-month period.
Price and Consensus: PPLI
The Walt Disney Company is executing a decisive technology transformation. In September, Disney appointed Karandeep Anand — former CEO of Character.AI — as chief technology officer, a newly created role unifying AI, infrastructure, and data platforms company-wide. Concurrently, Adam Smith's elevation to chairman of Direct-to-Consumer intensifies focus on Disney+ as the central fan hub, with expanded advertising technology oversight. Disney Ad Creative Studio's July closed beta introduces AI-powered connected TV ad generation, unlocking new advertiser revenues. August's beta launch of AI-powered search on Disney+ and ESPN strengthens discovery and engagement. The 2026 Disney Accelerator, focused on robotics, generative AI, and data synthesis, reinforces a technology-led growth mandate, making DIS a constructive near-term investment.
The Zacks Consensus Estimate for this Zacks Rank #3 (Hold) company’s fiscal 2026 earnings has moved north by 1.2% to $6.91 per share over the past 60 days. DIS shares have returned 10% in the past six-month period.
Price and Consensus: DIS
Reservoir Media is advancing a global expansion strategy with compelling fundamental momentum. In July 2026, the company deepened its Latin music presence by acquiring Nacional Records' catalog and publishing arm, Canciones Nacionales, alongside a joint venture to develop Latin artists and songwriters. In August, PopIndia acquired Chennai-based Vincey Productions' catalog, including 10 million YouTube subscribers, and signed India-based hip-hop producer 30KEY! for a publishing deal. On Sept. 30, Reservoir announced a publishing deal with Diamond-selling, Grammy-nominated songwriter-producer Jake Sinclair, plus a joint venture to develop emerging talent. First-quarter fiscal 2027 results showed 12% revenue growth to $41.5 million and a 13% adjusted EBITDA expansion. The company's fiscal 2027 guidance calls for mid-single-digit top- and bottom-line growth, supporting continued momentum.
The Zacks Consensus Estimate for this Zacks Rank #3 company’s fiscal 2027 earnings has remained steady at 13 cents per share over the past 60 days. RSVR shares have declined 2.1% in the past six-month period.
Price and Consensus: RSVR