Is AMC Networks, Inc. Destined to Be Acquired?

Three Fools take the Internet to discuss the prospects for a deal in the wake of Rupert Murdoch’s bid for Time Warner.

Jul 21, 2014 at 11:33PM

Shares of AMC Networks, Inc. (NASDAQ:AMCX) rallied about 4% amid the news of Rupert Murdoch's unsolicited $80 billion bid to acquire Time Warner. Is that fair? Should investors expect Murdoch or another suitor to target AMC with a rich takeover bid?

Guest host Alison Southwick puts these questions to Fool analysts Nathan Alderman and Tim Beyers, who debate the merits in this episode of 1-Up on Wall Street, The Motley Fool's Web show in which we talk about the big-money names behind your favorite technology, movies, toys, video games, comics, and more.

Tim opens by arguing that AMC has a rich pipeline of more than 60 properties in development. So even if Halt & Catch Fire hasn't earned the ratings executives might like, the show also opened opposite HBO's ultra-hit Game of Thrones. Meanwhile, Revolutionary War drama Turn did well enough to get a second season, while Better Call Saul could anchor the network's fall 2015 season.

AMC is also improving financially. At 19%, returns on capital are running well above the cost of AMC's admittedly significant debts. Mix in more than $500 million in cash reserves on the balance sheet, and there's every reason to believe that AMC can keep investing in the sorts of off-the-beaten path programming that would tempt a suitor. (Source: S&P Capital IQ.)

Nathan counters that the family of Cablevision (NYSE:CVC) founder and chairman Charles Dolan effectively controls AMC and uses the business to further its own interests, a bad sign. He also argues that there aren't enough properties besides The Walking Dead to protect investors were the zombie apocalypse to suddenly end.

Who do you think has the better argument? Click the video to watch as Alison puts Tim and Nathan on the spot, and then leave a comment below to let us know what you think. You can also follow us on Twitter for more segments and regular geek news updates!

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Alison Southwick has no position in any stocks mentioned. Nathan Alderman owns shares of Apple. Tim Beyers owns shares of Apple, Google (A and C class), Netflix, and Time Warner. The Motley Fool recommends AMC Networks, Apple, Google (A and C shares), and Netflix and owns shares of Apple, Google (A and C class), and Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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