How Will Scripps Networks (SNI) Stock React To Takeover Talk?

NEW YORK (TheStreet) -- Shares of Scripps Networks Interactive (SNI) are up 0.24% to $80.53, as investors are pricing the owner of HGTV and the Food Network as if it's already in takeover talks, Bloomberg reports.

The elevated stock price reflects bets that an offer could come soon, whether from Discovery Communications (DISCA) , Viacom (VIA) or other television network operators, Bloomberg said.

The speculation intensified after 21st Century Fox (FOXA) made a bid for Time Warner (TWX) , which valued the owner of HBO and CNN at almost 12 times profit. While Fox's effort failed, Scripps is now trading at about the same valuation, Bloomberg noted.


Price may make an acquisition challenging, because Scripps probably wouldn't be willing to sell for less than $100 per share, said Wunderlich Securities.

The shares closed at about $80 yesterday, giving it a market value of $11 billion.

TheStreet Ratings team rates SCRIPPS NETWORKS INTERACTIVE as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate SCRIPPS NETWORKS INTERACTIVE (SNI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, increase in stock price during the past year and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

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