Wednesday, May 5, 2010

Discovery Communications

This is an interesting company. Most would recognize the Discovery Channel which is part of the company. Other channels that the company offers include Animal Planet, the Science Channel, and several other interesting offerings. I find the company interesting because their TV fare is considerably different from most of the other TV channels. Not only does their programming strive to entertain but it also strives to educate and inform. All that is really lacking in their offerings is a news channel and a finance channel to sort of round out their offerings. Maybe sometime in the future.

Discovery Communications is a publicly traded company and that is why I am posting this blog. It has several classes of stock outstanding--DISCA, DISCB, and DISCK. I am not all that fond of companies with different classes of stock, but I may make an exception now and then.

The financials of the company are as follows for 2009.

Revenue $3.5 billion
Net income $560 million
equity $6.2 billion
LT Debt $3.5 billion

The class A shares are trading for about $38-39 a share as I write this. With EPS of for 2010 projected to be about $1.64 the PE is about 24. It is currently a little too high to be considered a buying opportunity currently but on a pull back to about $34 the stock would look reasonably attractive.

One of the interesting aspects of this company is that it serves markets in 180 countries in 35 different languages. It truly serve a world wide market. I have watched the Discovery Channel is England, Estonia, Ecuador, and Peru. This company has the potential of becoming the Nestles of educational entertainment.