Time Warner Inc (TWX): Today's Featured Media Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Time Warner ( TWX) pushed the Media industry lower today making it today's featured Media laggard. The industry as a whole closed the day down 1.4%. By the end of trading, Time Warner fell 95 cents (-2.1%) to $44.93 on average volume. Throughout the day, 6.3 million shares of Time Warner exchanged hands as compared to its average daily volume of 7.6 million shares. The stock ranged in price between $44.64-$45.90 after having opened the day at $45.79 as compared to the previous trading day's close of $45.88. Other companies within the Media industry that declined today were: Envoy Capital Group ( ECGI), down 8.7%, Inuvo ( INUV), down 7%, Nexstar Broadcasting Group ( NXST), down 6.9%, and KIT Digital ( KITD), down 6.6%.
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Time Warner Inc. operates as a media and entertainment company in the United States and internationally. It operates in three segments: Networks, Film and TV Entertainment, and Publishing. Time Warner has a market cap of $43.33 billion and is part of the services sector. The company has a P/E ratio of 17.8, equal to the average media industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Shares are up 27% year to date as of the close of trading on Thursday. Currently there are 16 analysts that rate Time Warner a buy, no analysts rate it a sell, and 10 rate it a hold.

TheStreet Ratings rates Time Warner as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the media industry could consider PowerShares Dynamic Media ( PBS) while those bearish on the media industry could consider ProShares Ultra Sht Consumer Services ( SCC).

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