Rising costs, advertising headwinds prompt Jefferies' PT cut on Nine Entertainment

Nine Entertainment Holdings

03/05/2023 20:14

** Jefferies cut annual earnings expectations for Nine
Entertainment Co Holdings Ltd  NEC.AX  after the Australian
broadcaster warned of challenges in advertising markets and from
rising costs
    ** NEC on Wednesday said Total Television, part of its top
revenue-generating unit Broadcasting, will experience costs
growth during H2, impacting growth, with advertising revenue
seen "down in the very low single digits" in FY23 vs FY22
    ** NEC forecasts FY23 EBITDA around A$590 mln ($394.12 mln)
and A$600 mln, below last year's A$700.7 mln
    ** NEC expects to continue to grow revenue share across all
key advertising platforms in 1HCY23
    ** Jefferies concerned about macro headwinds on rising costs
and headwinds to growth; cuts PT to A$2.08 from A$2.13 and
maintains "hold" rating
    ** Brokerage cuts NPAT estimate by 10.4% to A$261.6 mln for
FY23, and by 7.2% to A$261.2 mln for FY24, down from A$348.5 mln
in FY22
    ** Seven of 10 analysts rate the stock "buy" or higher, and
three rate it "hold"; their median PT is A$2.55 – Refinitiv data

($1 = 1.4970 Australian dollars)

 (Reporting by Sameer Manekar in Bengaluru)
 ((Sameer.Manekar@thomsonreuters.com; Twitter: https://twitter.com/sameer_manekar))