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British Sky Broadcasting Group, better known as BSkyB, plays an important role in the British TV and radio landscape.BSkyB brings us entertainment, information and sport through mass program distribution.
BSkyB has 20 per cent upside potential, suggests Espirito SantoJune 25 2012, 10:08am
Analyst Giasone Salati gives the stock a fair value of 820 pence (current share price: 660.5 pence) and says there are two positive catalysts in the next 12 months.
The first relates to NOW TV - the firm's new broadband entertainment service expected to launch this summer.
This service was originally meant as a defensive move in response to emerging competition from such offerings as Lovefilm, said the analyst, but now "seems to be a product on its own".
Espirito's survey has shown a potential for 650,000 new subscribers, and a first year contribution of £13 million in pre-tax profits.
The second catalyst, believes the bank, is that the recent Premier League TV rights deal paves the way for the company to roll out further profitable fibre-optic upgrades to provide the service.
Sky retained the maximum number of live domestic rights and will televise 116 top flight English games a year for three seasons starting in August next year, while BT earned the right to show 38 matches a year.