Shore Capital continues to see Sky (LON:SKY) as hold, arguing that culture secretary has paved the way for a multi-million pound bidding war for the group, Citywire reports. The comments came after the UK government cleared the way for 21st Century Fox to buy the pay-TV provider on the condition that it divests Sky News.
Sky’s share price rose in the previous session, adding 0.37 percent to 1,359.00p, largely in line with gains in the broader UK market, with the benchmark FTSE 100 index adding 25.57 points to end the session 0.33 percent higher at 7,712.37. The group’s shares have added just under 40 percent to their value over the past year, as compared with about a 2.5-percent gain in the Footsie.
ShoreCap sees Sky as ‘hold’
Shore Capital reaffirmed Sky as a ‘hold’ after Culture Secretary Matt Hancock confirmed Comcast could bid for Sky while Fox could also go ahead with its takeover as long as it sells Sky News.
“We would certainly not rule out this possibility, but we are mindful that Fox’s own circumstances have changed materially since its original approach,” the broker’s analyst Roddy Davidson commented, as quoted by Citywire. “Specifically, its appetite for increasing its offer is likely to be determined by Disney – which agreed in December to acquire the majority of its assets, including […] its stake in Sky.”
Other analysts on group
UBS, which has a ‘buy’ rating on Sky, set a price target of 1,500p on Sky yesterday, while Liberum reaffirmed the company has a ‘hold,’ without specifying a valuation on the shares. According to MarketBeat, the blue-chip group currently has a consensus ‘buy’ rating and an average price target of 1,305.40p.