Media Spain: Prices have caught up with the outlook
2017 was an atypical year for Spanish Media, as the divergent performances between the advertising market and macro performance meant initial expectations were too optimistic. For the whole of 2017, Atresmedia and Mediaset España underperformed markedly (19% and 24%) as ad market woes together with the structural issues we identified for Spanish FTA players contributed to this evolution. For 2018E we forecast the TV ad market to grow by 2% (+3% previously) and we see no change in the long-term dynamics for A3M and MSE, where both should see their share in the market being diluted by the increasingly higher share of the Pay-Tv segment. However not only do we think the last 12M underperformances already reflect some of these concerns, we also see lower risk on consensus expectations and more reasonable valuations vs peers; our revised forecasts together with the valuation roll over lead our FVs to increase from €8.3 to €9.6 at MSE and in the case of A3M to be cut from €8.4 to €8.1. We upgrade both stocks from Sell to NEUTRAL.Atresmedia Corporacion De Medios De Comunicacion is a television and radio broadcasting company based in Spain. Co. is engaged in the indirect management of television and radio services, which include the broadcasting, creation, production and distribution of television and radio programming, and the sale of advertising time. Group companies mainly carry on business activities relating to the production, copying and broadcasting of sounds and images, and TV and Internet home shopping. Co. provides National and World Digital Television Services. Co. is the parent company of Grupo Antena 3.
Gestevision Telecinco is a television network company based in Spain. Co. heads a group of dependent companies, which form the Telecinco Group. Through its subsidiaries, Co. is engaged in the management and commercial exploitation of a television network. Co.'s television network acquires, produces, and distributes audiovisual content. Co. also sells the network advertising airtime, carried out by its subsidiary. In addition, Co. is involved in the sale of other advertising products; production of news programs; the production and sale of audiovisual property rights; and teleshopping.
Haitong is the first international Chinese investment bank and our goal is to be the primary channel for capital flows into and out of China. During 2015 the Senior Management Team in London was expanded significantly to focus on this objective and to provide a full-service cross-asset markets business coupled with sector-focused investment banking. We work closely with our world-wide network of offices to bring a true depth of understanding to all client situations.
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