Morningstar Rating

Stock Research and Analysis

by Neil Macker, CFA

Bulls Say

Viacom owns a number of well-known cable networks, including MTV, Nickelodeon, and BET, which are very popular with traditionally hard-to-reach audiences--teens, children, and African-Americans.
Viacom's Paramount Pictures holds the rights to thousands of films, including some of the most popular ever made. As media formats evolve, the firm can make money from these films in different formats.
Affiliate fees provide roughly one third of cable network revenue, offering some earnings stability. Read more 

Bears Say

The emergence of new entertainment options such as Netflix and short-form online video is challenging the traditional media business model. If Viacom fails to adapt to the constantly shifting environment, the firm could find its model obsolete.
The current share repurchase pace in excess of $3 billion per year may be unsustainable.
Developing hit programs can be unpredictable, especially content aimed at a younger demographic, whose tastes can be capricious. Read more 

Management

Viacom's stewardship of shareholder capital is standard. The biggest knock against the company is its ownership structure. Chairman Sumner Redstone controls Viacom through ownership of Class A shares--representing nearly 80% of majority of the outstanding   Read more 

Profile

Viacom is a global media company with several leading cable network properties, including Nickelodeon, MTV, BET, Comedy Central, VH1, Country Music Television, and Spike   Read more 

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