CBS (NYSE:CBS) made financial headlines this week over its battle royale with Time Warner Cable (NYSE:TWC) concerning distribution fees. Nevertheless, CBS’s stock has performed admirably this year — up 34 percent in the past six months. Can CBS continue its impressive run? Let’s use our CHEAT SHEET investing framework to decide whether CBS is an OUTPERFORM, WAIT AND SEE, or STAY AWAY.
C = Catalysts for the Stock’s Movement
In addition to its seminal series, CSI and NCIS, which enjoy both strong international and domestic audiences, CBS has continued to develop hits for its namesake network channel. These shows include Big Brother, The Big Bang Theory, and Under the Dome. According to Nielsen, these were three of the top 10 most-watched network TV shows last week. CBS continues to experience growth within its Showtime Networks — revenue increased 6 percent in the first quarter on a year-over-year basis. While Showtime continues to face competition from Time Warner’s (NYSE:TWX) HBO, the network has recently expanded its distribution by inking key deals with online streaming services such as Amazon (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX).