Zacks Investment Research upgraded shares of CBS Corporation (CBS) from UNDERPERFORM to NEUTRAL on January 07, 2015, with a target price of $56.00.
CBS Corp. continues to focus on diversifying its revenue streams to lower dependency on traditional advertising revenues. These include reverse compensation from affiliates, digital distribution, and retransmission consent fees. At the same time, the company is keeping up with changing trends and to cater to need of cord cutters, it has launched two over-the-top channels. Moreover, it will launch an independent streaming service for its premier channel Showtime, somewhere in 2015. All these prompt us to upgrade our recommendation on the stock to Neutral. However, rise in programming costs and unfavorable currency fluctuations continue to be concerns. Further, an unimpressive content licensing pipeline for the next two quarters will result in tougher year over year comparisons.
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