Why AMC Networks Shares Soared

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of cable mainstay AMC Networks (Nasdaq: AMCX  ) were captivating investors today, gaining as much as 14% on a strong quarterly earnings report

So what: The producer of shows like Mad Men and The Walking Dead said the popularity of its programming helped boost sales 17% to $332 million, despite a dispute with Dish Network (Nasdaq: DISH  ) that deprived AMC of 13% of its audience. DISH resumed carrying AMC channels -- which include WE, IFC, and Sundance -- last week, so fourth-quarter results should be mostly unaffected. Operating income and cash flow took a hit due to the dispute, and EPS declined slightly to $0.51 a share, but that still easily topped analyst estimates of $0.37.

Now what: The performance of The Walking Dead has been particularly strong, as it set the record for most-watched cable drama in its third-season premiere last month. Investing in TV networks can be difficult as original content providers experience a "program cliff" much in the way drugmakers face a patent cliff, so these companies need to develop a pipeline of appealing programs. However, with a season or two left in Mad Men and The Walking Dead just hitting its stride, the network seems to have some time before facing those concerns. Shares could continue to push higher in the near term.

Don't miss out on the latest news about AMC. Add the company to your Watchlist by clicking here.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2102765, ~/Articles/ArticleHandler.aspx, 10/21/2014 5:57:08 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement