0424 GMT - Seven West Media's A$2.7 billion long-term commitment for programming rights looks like a risk to shareholder equity for a company valued at just A$270 million, Morgan Stanley analyst Andrew McLeod writes in a note. He stresses that it's not the primary reason for his continued bearish stance on the stock, but thinks that a commitment of that size warrants more attention. The payments will weigh on any unexpected medium-term profitability Seven West generates, he adds. McLeod's concerns are based on the media conglomerate's high operating leverage in a weak advertising market and its rising debt load. MS cuts its target price 27% to A$0.16 and keeps an underweight rating on the stock, which is flat at A$0.175. (stuart.condie@wsj.com)
(END) Dow Jones Newswires
September 23, 2024 00:25 ET (04:25 GMT)
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