Time Warner (NYSE: TWX) and AMC Networks (NASDAQ:AMCX) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.
This table compares Time Warner and AMC Networks’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings for Time Warner and AMC Networks, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Time Warner presently has a consensus price target of $104.33, suggesting a potential upside of 10.31%. AMC Networks has a consensus price target of $59.40, suggesting a potential upside of 14.89%. Given AMC Networks’ higher possible upside, analysts clearly believe AMC Networks is more favorable than Time Warner.
Volatility and Risk
Time Warner has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500. Comparatively, AMC Networks has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500.
Valuation & Earnings
This table compares Time Warner and AMC Networks’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Time Warner||$31.27 billion||2.36||$5.25 billion||$6.42||14.73|
|AMC Networks||$2.81 billion||1.12||$471.31 million||$7.37||7.01|
Time Warner has higher revenue and earnings than AMC Networks. AMC Networks is trading at a lower price-to-earnings ratio than Time Warner, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
80.8% of Time Warner shares are owned by institutional investors. Comparatively, 90.4% of AMC Networks shares are owned by institutional investors. 0.2% of Time Warner shares are owned by insiders. Comparatively, 17.7% of AMC Networks shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Time Warner pays an annual dividend of $1.61 per share and has a dividend yield of 1.7%. AMC Networks does not pay a dividend. Time Warner pays out 25.1% of its earnings in the form of a dividend.
Time Warner Company Profile
Time Warner Inc. is a media and entertainment company. The Company operates through three segments: Turner, which consists of cable networks and digital media properties; Home Box Office, which consists of premium pay television and over the top (OTT) services and premium pay, basic tier television and OTT services internationally, and Warner Bros., which consists of television, feature film, home video, and videogame production and distribution. It also holds interests in companies that operate broadcast networks. The Company holds interest in Central European Media Enterprises Ltd. (CME), which is a broadcasting company that operates television networks in Bulgaria, Croatia, the Czech Republic, Romania, the Slovak Republic and Slovenia and The CW broadcast network (The CW), which includes a lineup of advertising-supported original programming, such as The 100, Arrow, Crazy Ex-Girlfriend, DC’s Legends of Tomorrow, The Flash, Frequency, iZombie, Jane the Virgin and No Tomorrow.
AMC Networks Company Profile
AMC Networks Inc. is a holding company, which conducts all of its operations through its subsidiaries. The Company owns and operates entertainment businesses and assets. It operates through two segments: National Networks, and International and Other. National Networks includes activities of its programming businesses, which include its programming networks distributed in the United States and Canada. The International and Other segment includes AMC Networks International (AMCNI), the Company’s international programming businesses consisting of a portfolio of channels in Europe, Latin America, the Middle East and parts of Asia and Africa; IFC Films, the Company’s independent film distribution business; AMCNI- DMC, the broadcast solutions unit of certain networks of AMCNI and third-party networks, and various developing online content distribution initiatives. National Networks’ programming networks include AMC, WE tv, BBC AMERICA and SundanceTV.
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