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CBS Subsidiary Announces TV Series Based on Video Game Halo

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CBS Corporation’s (CBS - Free Report) subsidiary Showtime Networks recently announced that video game Halo will soon be made available on television in the form of a 10-episode series.

Halo, an internationally hit science fiction military video game created by Bungie, is currently managed and developed by 343 Industries, a subsidiary of Microsoft (MSFT - Free Report) .

The popular game launched in 2001 is based on a “26th-century conflict between humanity and an alien threat known as the Covenant”. Notably, the game sold more than 70 million copies worldwide and generated sales exceeding $5 billion till June 2016.

Rupert Wyatt, director of Rise of the Planet of the Apes, will direct multiple episodes and is also the executive producer. Kyle Killen, creator of Awake, will write and oversee the series, per Fox 45 news.

Per Reuters, production of the series is likely to begin in 2019. Notably, Steven Spielberg’s Amblin Television and 343 Industries will co-produce the show.

Expanding Content to Drive Growth

Showtime Networks, a digital streaming subscription offering, lets users access its content on Apple devices, Roku media and PlayStation. As more and more people have started streaming TV online, CBS is likely to gain from increasing demand for content and expansion of direct-to-consumer business.

Additionally, the company’s sustained focus on increasing subscription-based revenues is a positive. CBS All Access and Showtime OTT continue to gain subscribers steadily, which is likely to boost affiliate and subscription fees.

In fact, subscriber base has reached 5 million. The company expects to surpass 8 million subscribers base by 2020.

The subscriber growth is expected to be driven by strong entertainment content portfolio. New signups for CBS All Access service jumped 100% year over year in the last reported quarter, driven by shows like Star Trek: Discovery, The Good Fight, and the Grammys.

Continuing investments on expanding original series content portfolio is expected to further drive subscriber growth in the long haul.  

CBS Corporation Price and Consensus

CBS Corporation Price and Consensus | CBS Corporation Quote

Sports Focus: Key Catalyst

The launch of CBS SPORTS HQ, a 24-hour streaming sports news network, which will cover sports news, highlights and analysis, will benefit CBS. In fact, with the launch of sports streaming network, the company is trying to imitate the success of its first streaming news channel CBSN.

Ever since the launch of CBSN in 2014, the network has shown exceptional growth rate. In 2017, streaming increased to 287 million, up 17% from the election year of 2016.

Zacks Rank & Stocks to Consider

Currently, CBS carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader computer & technology sector include Micron Technology (MU - Free Report) and NVIDIA Corporation (NVDA - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Micron and NVIDIA is currently pegged at 8.2% and 10.3%, respectively.

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