Roger Goodell Comments On The NFL's 'Significant Improvements Post-Election'

Wunderlich said the recent positive comments from NFL Commissioner Roger Goodell bode well for CBS Corporation (NYSE: CBS). The brokerage maintains its Buy rating and $72 price target on shares of CBS.

Goodell On Ratings, CBS

Goodell highlighted significant improvements post-election in ratings to Walt Disney Co (NYSE: DIS) ESPN's Darren Rovell, with ratings down just 2 percent for weeks 10–14, averaging 18.1 million viewers, compared to a 14 percent decline from 2015 for the first nine weeks of the season.

Sunday daytime games, where the key local fan base lies, are down just 4 percent season-to-date for Twenty-First Century Fox Inc (NASDAQ: FOXA)'s NFC emphasis, with CBS down 7 percent for its ABC-oriented package.

Meanwhile, CBS has the NFL AFC Sunday package until 2022 and (shared) Thursday nights for just one more year. These shows are directly profitable, and they also attract younger men to watch television.

Brokerage Commentary

“We think that this highlights the continued wisdom of Buy-rated CBS (CBS) coupling profitable sports with hit entertainment programming,” analyst Matthew Harrigan wrote in a note.

Harrigan believes 2017 comparison issues should be largely buffered by retransmission gains, with over 21 percent of the retrans and 14 percent of the reverse retrans footprint up for renewal in 2017.

“We feel that large media can grow at least in line with nominal U.S. corporate earnings growth LT, and CBS is well situated given its branded hit programming at CBS itself and Showtime,” Harrigan added.

Shares of CBS closed Friday’s regular trading session at $64.54.

Image Credit: By MarineCorps NewYork from New York City, USA Sgt Randall A Clinton/Division of Public Affairs, New (Marines at NFL Draft 2012) [Public domain], via Wikimedia Commons