Stocks within the entertainment industry have plunged in the past couple of months.  Contrarian investors therefore have an opportunity to scoop up shares of quality stocks at cheaper prices.

That’s why today I’ll analyze two prominent stocks within the industry, ViacomCBS (VIAC) and DISH Network  (DISH), to determine which is currently the better buy.  VIAC operates through the following segments: TV Entertainment; Cable Networks; and Filmed Entertainment. Its portfolio includes CBS, SHOWTIME, Paramount Pictures, MTV, Comedy Central, and Paramount+. Together with its subsidiaries, DISH provides pay-TV services in the United States. The company operates in two segments: Pay-TV and Wireless. In addition, it has more than 11 million Pay-TV subscribers in the United States.

VIAC and DISH should be on your 2022 watchlist, as Wall Street predicts both stocks to surge more than 40% in the coming year.

ViacomCBS Inc. (VIAC)

On November 10, 2021, VIAC and Twitter, Inc. (TWTR) announced a new, multi-year global agreement. Andrea Wolinetz, SVP, Distribution & Business Development-Streaming at VIAC, said, “Twitter is the digital water cooler for trending topics and fandom worldwide, and we’re excited to provide front-row access to innovative digital content experiences and culture-defining moments across the best of entertainment, news and sports for Twitter users everywhere.”

VIAC’s revenue came in at $6.61 billion for the fiscal third quarter ended September 30, 2021, up 13.2% year-over-year. The company’s cash and cash equivalents came in at $4.82 billion for the period ended September 30, 2021, compared to $2.98 billion for the period ended December 31, 2020. Also, its total assets came in at $55.91 billion, compared to $52.66 billion, for the same period.

For fiscal 2021, analysts expect VIAC’s revenue to increase 11% year-over-year to $28.06 billion. The company’s EPS is expected to grow 4.9% year-over-year to $3.84 in fiscal 2022. In addition, it surpassed the consensus EPS estimates in three of the trailing four quarters. 

Over the past month, the stock has gained 6.4% and Wall Street analysts expect the stock to hit $47 in the near term, which indicates a potential upside of 42%.

DISH Network Corporation (DISH)

On December 16, 2021, DISH and FreedomFi, an open 5G networking company, announced their collaboration on a pilot program to provide DISH’s current and future wireless customers with access to the world’s first community-driven, neutral host CBRS hotspot network. Chris Ergen, head of the Office of Innovation, DISH Wireless, said, “We are fully committed to our buildout and view this pilot as a valuable opportunity to further connectivity, innovation and openness.”

For the fiscal third quarter ended September 30, 2021, DISH’s net income came in at $557.04 million, representing a 10.4% year-over-year rise. Its EPS came in at $0.88, compared to $0.86 in the year-ago period. Moreover, its total assets came in at $41.21 billion for the period ended September 30, 2021, compared to $38.24 billion for the period ended December 31, 2020.

Analysts expect DISH’s revenue to increase 13.4% year-over-year to $17.57 billion in fiscal 2021. Its EPS is expected to increase 19.2% year-over-year in fiscal 2021 to $3.60. Also, it surpassed the EPS estimates in three of the trailing four quarters. 

Over the past month, the stock has gained 6.4% and Wall Street analysts expect the stock to hit $53.57 in the near term, which indicates a potential upside of 58%.

VIAC shares were trading at $33.09 per share on Tuesday afternoon, up $0.85 (+2.64%). Year-to-date, VIAC has gained 9.64%, versus a 0.51% rise in the benchmark S&P 500 index during the same period.

About the Author: Riddhima Chakraborty

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries. More...

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