Discovery Communications (Class A) Stock Analysis, Valuation (NASDAQ:DISCA)

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$23.86 $0.18 (0.75%) DISCA stock closing price Feb 16, 2018 (Closing)
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Discovery Communications (Class A)
Updated on : Feb 16, 2018
previous close
DISCA 23.9 (0%)
S&P 500 2732.2 (0%)
Closing Price On: Feb 16, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Broadcasting-Radio-TV
Sector :
Consumer Discretionary
5 Quarter Revenue
Revenue Growth
2017-Q3
$billion
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
31.1%
Sector Average:
11%
5 Quarter Net Profit
Net Margins
2017-Q3
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
14.71B
Debt/Equity Ratio:
 2.56
Compared to the industry
Cash Flow
Operating cash flow:
$724M
Net Income:
$218M
PROS      CONS
Operating Margins
Net Margins
Cash Flow
ROIC
ROE
FCF Margin
High Debt Burden
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
DISCA PS :
1.4
Industry PS :
1.7
Sector:   Consumer Discretionary.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
12.4%
Return on Equity:
20.6%
Free Cash Flow Margin:
42.3%
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DISCA Stock Analysis

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Take a look at Amigobulls Discovery Communications stock analysis video. Our analyst opinion covering the buy and sell arguments for DISCA stock is shown in the video.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Discovery Communications Inc. Stock Rating 4.1/5

Amigobulls DISCA stock analysis uses latest quarter 2017 Q3 financial data like Discovery Communications revenue growth, profit margins and cash flows. We also use relative valuation metrics like PE ratio and price to sales ratio for Discovery Communications valuation analysis. Based on a company's historical fundamentals we arrive at Discovery Communications stock rating which is indicative of the company's financial performance.

Should you buy DISCA stock?

  • The TTM operating margin was good at 31.1% for Discovery Communications (Class A).
  • LTM Net margins were good at 16.6% for Discovery Communications (Class A).
  • The company has an operating cash flow which is 3.3 times the net income. We see this as a positive signal.
  • The Discovery Communications (Class A) stock currently trades at a price to earnings ratio of 11.5. We rate this as a positive, compared to the industry average of 22.8.
  • When compared with the Broadcasting-Radio-TV industry average PS ratio of 1.7, the price-to-sales ratio of 1.4 for DISCA stock is attractive.
  • Discovery Communications (Class A)'s return on invested capital of 12.4% is good.
  • Return On Equity (ROE) which is a measure of the company's profitability, looks great for Discovery Communications (Class A) at 20.6%.
  • The company has a healthy free cash flow margin of 42.3%.

Should you sell DISCA stock?

  • Discovery Communications (Class A) has a debt/equity ratio of  2.56, which is worse than the average in the Consumer Discretionary sector.

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Comments on this video and Discovery Communications (Class A) stock

Amigobulls Discovery Communications stock analysis helps investors in understanding how the company's fundamentals have performed in the last few quarters. The fundamentals of a company are vital to identify long-term investment opportunities.

Among the financials of the company, Discovery Communications revenue growth along with the profit or net income give a clear picture of the financial health. One can also combine technical analysis and fundamental analysis to get a holistic picture about DISCA stock.