Discovery Climbs on Analyst Upgrade

NEW YORK ( TheStreet) -- Discovery Communications ( DISCA) shares are climbing today after analyst David Miller with Caris upgraded the media company to an above average rating from average and boosted his price target on the stock to $48 from $43.

Miller expects Discovery to "guide measurably higher" after a few months of a flat performance.

He said a lack of catalysts and rebranding the Discovery Health channel into the Oprah Winfrey Network caused a "pause in the stock price during the last 4 months."

However a recent increase in overall business confidence prompted Miller to upgrade the stock.

"The upgrade comes as a result of a sweep through our sources within the media buying community," he said in his Jan. 20 research note to investors, "most of whom seem committed to spending anywhere between 10% and 12% more in dollar volume on the domestic side of Discovery's suite of fully-distributed networks when management begins its upfront selling season this June."

He said that Discovery saw some "notable ratings gains in 2010." The Learning Channel, or TLC, saw its audience increase by 3% in 2010, Animal Planet's audience gained 10% and Investigation Discovery saw viewership rise 64%.

Miller raised his fiscal 2011 revenue estimate to $4.09 billion from his previous guidance of $4.06 billion. He also boosted his fiscal 2011 earnings estimate to $2.30 a share from $2.14 a share.

Shares are up about 1.4% to above $40 in morning trading.

--Written by Theresa McCabe in Boston.

>To contact the writer of this article, click here: Theresa McCabe.

>To follow the writer on Twitter, go to @TheresaMcCabe.

>To submit a news tip, send an email to: tips@thestreet.com.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

More from Stocks

Danica Patrick's Final Race at 2018 Indianapolis 500: What She Thinks About Cars

Danica Patrick's Final Race at 2018 Indianapolis 500: What She Thinks About Cars

Why The FANG Stocks' Dominance May Not Be So Bad For The Market

Why The FANG Stocks' Dominance May Not Be So Bad For The Market

At End of May, Investors Signalling They May Stay Away

At End of May, Investors Signalling They May Stay Away

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever