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Grupo Televisa SAB ADR TV

Morningstar Rating
$3.16 0.00 (0.00%)
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Company Report

Grupo Televisa Earnings: Spinning Off Ollamani Should Turn Attention to the Cable Business

Grupo Televisa sharply improved profitability during the fourth quarter, but the more important task of reviving revenue growth remains a work in progress. Management indicated that customer metrics have steadily improved since the firm shifted its strategy last fall to reduce promotional discounting, and that the level of competition in the broadband market is easing somewhat. Commentary from rival Megacable on its earnings call lines up with this view. Still, the Mexico broadband market needs to consolidate to cement pricing discipline and reduce duplicative investment. We have trimmed our fair value estimate to $6.50 from $8, which primarily reflects the debt-free spinoff of Ollamani, which closed on Feb. 20. Ollamani holds the majority of Grupo Televisa’s former “other” segment, including Stadium Azteca, the Club America soccer team, and gambling operations. We expect Grupo Televisa will continue to look for ways to utilize its assets more efficiently and deliver value for shareholders.

Price vs Fair Value

TV is trading at a 51% discount.
Price
$3.16
Fair Value
$9.60
Uncertainty
High
1-Star Price
$21.92
5-Star Price
$8.10
Economic Moat
Qvkk
Capital Allocation
Swxq

Bulls Say, Bears Say

Bulls

Televisa’s cable business should continue to grow despite competitive pressure and remains well positioned to capitalize as broadband penetration in Mexico increases.

Bears

The Mexican broadband industry is more competitive than virtually any other market globally. Pricing is too low to generate attractive profitability and too many players are chasing too few customers.

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Trading Information

Previous Close Price
$3.16
Day Range
$3.153.23
52-Week Range
$2.105.66
Bid/Ask
$3.15 / $3.40
Market Cap
$1.84 Bil
Volume/Avg
8,006 / 3.0 Mil

Key Statistics

Price/Earnings (Normalized)
Price/Sales
0.42
Dividend Yield (Trailing)
3.15%
Dividend Yield (Forward)
3.15%
Total Yield
7.48%

Company Profile

Grupo Televisa is one of the leading telecommunication firms in Mexico. Its cable arm, Izzi, holds networks that pass nearly 20 million Mexican homes and provide broadband service to 6 million customers. The firm is also one of the largest pay-television providers in Mexico, with 4 million customers. Televisa holds a majority stake in Sky Mexico, the country’s only satellite-TV provider, serving about 6 million customers. After merging its traditional media business into Univision, Grupo Televisa owns a 45% stake in combined entity TelevisaUnivision. Grupo Televisa spun off several smaller businesses, including magazine publishing, three of Mexico's professional soccer teams, and Stadium Azteca in February 2024 under the name Ollamani.
Sector
Communication Services
Industry
Telecom Services
Stock Style Box
Mid Value
Total Number of Employees
35,923

Competitors

Valuation

Metric
TV
DIS
CMCSA
Price/Earnings (Normalized)
27.3610.65
Price/Book Value
0.251.992.03
Price/Sales
0.422.251.44
Price/Cash Flow
15.926.38
Price/Earnings
TV
DIS
CMCSA

Financial Strength

Metric
TV
DIS
CMCSA
Quick Ratio
1.540.690.50
Current Ratio
1.690.840.60
Interest Coverage
−1.423.376.01
Quick Ratio
TV
DIS
CMCSA

Profitability

Metric
TV
DIS
CMCSA
Return on Assets (Normalized)
−4.84%4.22%6.32%
Return on Equity (Normalized)
−10.94%8.71%19.98%
Return on Invested Capital (Normalized)
−4.26%5.86%10.60%
Return on Assets
TV
DIS
CMCSA
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