What’s Driving Up Time Warner Stock in 2017?



Time Warner’s year-to-date stock performance

On May 5, 2017, Time Warner (TWX) stock closed at $98.37. It has risen 1.9% YTD (year-to-date).

In contrast, The Walt Disney Company (DIS) stock has risen 7.5% YTD. Comcast (CMCSA) and Twenty-First Century Fox (FOXA) have seen their stock prices rise 13.0% and 3.9%, respectively, YTD.

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What could benefit Time Warner stock?

Time Warner announced its fiscal 1Q17 results on May 3, 2017. It reported revenues of $7.7 billion, a rise of 6.0% YoY (year-over-year). It posted adjusted operating income of $2.2 billion, a 7.0% rise YoY.

In 1Q17, Time Warner declared adjusted EPS (earnings per share) of $1.66, which was an 11.0% rise over fiscal 1Q16. It exceeded Wall Street analysts’ consensus expectation of $1.45 per share. The company had free cash flow of $1.4 billion at the end of 1Q17. Is HBO (Home Box Office) business posted record adjusted operating income of $583.0 million, a 22.0% rise over fiscal 1Q16.

In mid-February 2017, Time Warner shareholders approved AT&T’s proposed acquisition. Time Warner is seeing robust demand for its content, not only in the United States but also in international markets.

In this series

In this series, we’ll look at the key factors that could affect Time Warner for the rest of 2017 and how its businesses fared in fiscal 1Q17.

Time Warner makes up 0.37% of the SPDR S&P 500 ETF (SPY). SPY has a 3.9% exposure to the computer sector.


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