Jefferies expects Sky’s (LON:SKY) upcoming trading statement this week to reveal headwinds, the analysts have said. The comments came as the broker retained its ‘hold’ recommendation on the blue-chip pay-TV provider.
Sky’s share price closed 0.76 percent lower at 975.00p yesterday, slightly outperforming the broader London market, as the blue-chip FTSE 100 index shed 180.09 points to end the session 2.46 percent in the red at 7,147.50, with investors digesting the UK’s move to call a snap election in June. The group’s shares have lost some two percent of their value over the past year, and are down by more than one percent in the year-to-date.
Jefferies reiterated its ‘hold’ rating on Sky yesterday, with a price target of 1,050p on the shares, ahead of the group’s third-quarter trading update due out tomorrow.
“Disclosure is likely to be limited as normal but should be sufficient to illustrate headwinds from a weaker consumer environment in the UK and, in Italy, reduced appetite,” the broker’s analyst Jerry Dellis pointed out, as quoted by Citywire, adding that the pay-TV provider was further unlikely to make any comments on the proposed acquisition by 20th Century Fox.
“Whilst competition clearance from the European Commission was received on 7 April, the more sensitive matters of the UK public interest reviews and Ofcom’s ‘fit and proper’ assessment on Sky are not due to report until 16 May,” Dellis noted.
The 17 analysts offering 12-month price targets for the Financial Times have a median target of 1,075.00p on the shares, with a high estimate of 1,350.00p and a low estimate of 400.00p. As of April 14, the consensus forecast amongst 18 polled investment analysts covering the blue-chip group has it that the company will outperform the market.