Sky TV leads NZX50 higher
New Zealand shares edged higher, led by Sky TV as investors backed its bid to grow revenue even as a new survey showed online competitor Netflix dominating the NZ market.
Friday, September 3rd 2021, 6:58PM
by BusinessDesk
The S&P/NZX 50 Index rose 8.4 points, or 0.1%, to 13,288.87. Turnover was $171.9 million.
Forsyth Barr’s research team said the 5% return in August made it the index’s best month since November 2020, with mid-sized stocks outperforming with a 6.1% return.
Entertainment company Sky TV led the index higher today, climbing 4.6% to reach 20.5 cents. The stock is now up almost 30% since last Thursday.
The rally has been given further fuel this week by Californian investors Osmium Partners buying up a 5.7% stake for $15.8m and chief executive Sophie Maloney buying up $148,000 worth of shares with her own money.
Many investors are thinking that Sky has hit the bottom of a years long revenue decline and are poised to grow revenue once again. The company has lost more than 90% of its market value in the past five years, even after the recent bounce.
Today, an NZ on Air survey showed 30% of New Zealanders over the age of 15 have access to Sky TV in 2021 down from 57% who reported having access in 2014.
The survey also found only 35% of people under the age of 40 watch television daily, while just 16% reported watching pay-TV. Meanwhile, 72% were streaming video on demand.
Sky’s strategy is to bundle up its new Sky Box with the more popular digital streaming options, including Netflix as well as its own Neon and Sky Sport platforms.
The pay-TV operator is also set to reduce its number of shares on issue next week by consolidating every 10 shares into one share as of Sept 16.
This means each Sky TV share will trade just above $2 – based on today’s price – although it won’t change the valuation of the underlying company.
Plexure also saw its stock price on the mend, jumping another 10% today to trade at 66 cents, following its successful capital raising at 52 cents.
The stock is now down just 4.3% from where it was prior to its chief executive’s abrupt resignation at the beginning of August.
Shares in My Food Bag climbed 2.1% to $1.44, now up 13.4% since lockdown began.
Craigs Investment Partners added the meal-kit company to a list of 13 stocks they think will outperform the market, swapping out Tourism Holdings.
The analysts noted the stock was one of the cheapest on the NZX, trading on a multiple of 16 times its forward earnings and offering a yield of 5%.
Tourism Holdings climbed 0.8% to $2.42, despite Craigs’ analysts saying there were no medium-term catalysts to support the stock with travel remaining restricted during that time.
Restaurant Brands posted the day’s biggest decline, falling 3.1% to $15.51, while Mainfreight continued to fall from its highs closing down 1.1% at $95.45.
| « NZ shares settle after action packed earnings season | NZX 50 makes seven day gain run » |
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