Morgan Stanley remains bullish on ITV (LON:ITV), pointing to a raft of factors, including improving momentum in advertising trends. The comments follow the blue-chip broadcaster’s recent third-quarter results which revealed a drop in the company’s advertising revenue, and come as the company prepares to welcome its new chief executive in early January.
ITV’s share price has been subdued in London in today’s session, having given up 0.62 percent to 151.45p as of 14:28 GMT, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.09 percent lower at 7,410.74 points. The group’s shares have lost more than eight percent of their value over the past year, and are down by some 26 percent in the year-to-date.
Morgan Stanley remains bullish on ITV
Morgan Stanley reiterated its ‘buy’ rating on ITV yesterday, with a price target of 230p on the shares. WebFG News reports that the analysts had cited nine different factors to back up their investment thesis, including the improving momentum in advertising trends, with advertising revenues seen starting to rise in the first three months of 2018 and growing by five percent in the second quarter of the year.
The company’s good audience performance meanwhile meant that there was no impetus to increase underlying programme spend.
The comments came after JPMorgan Cazenove turned bullish on the blue-chip broadcaster earlier in the week, arguing that the European sector is markedly undervalued by the market. The broker, however, lowered its valuation on the shares.
New CEO at ITV
Morgan Stanley also weighed in on ITV’s new boss – easyJet’s (LON:EZJ) outgoing chief executive Carolyn McCall – noting that discussions with the chairman had indicated that she was more likely to push for a ‘refresh’ rather than a ‘fundamental change’.