Media and Entertainment Sector: A Mixed Outlook

Media and Entertainment Sector: A Mixed Outlook
3:37

Despite recent earnings beats, the media and entertainment sector faces a mixed outlook as AI spending challenges loom. Learn how analysts' forecasts reflect growing optimism for 4Q-2Q25, but with caution for the near term. Learn more from Thulisa Shandu at EasyAssetManagement.


Despite recent strong earnings, analysts have mixed feelings about the media and entertainment sector. Although they've raised their profit expectations for the next year, the high costs associated with AI investments for large companies could make it challenging to meet these higher targets.

Over the past 12 weeks, analysts have slightly lowered their profit forecasts for the sector by 5 bps for the third quarter but have increased their expectations for the fourth quarter and into 2025 by 47 bps, 27 bps, and 126 bps. This shows growing optimism, especially for the latter part of the year.

Media and entertainment companies have experienced varying levels of analyst sentiment. On average, EPS forecasts for media and entertainment have been raised the most for the next four quarters, with an increase of 72 bps. In contrast, telecom services have seen the largest cuts in EPS estimates, averaging -39 bps.

Among individual companies, Paramount, Charter, Alphabet, Walt Disney, and Netflix have experienced the most significant increases in EPS estimates for the current fiscal year. However, Warner Bros Discovery, Live Nation, Match, Fox, and AT&T have seen their estimates cut.

In conclusion, the global market landscape is currently characterized by significant regional divergence. While some markets, such as the US and India, have experienced strong growth, others, particularly in Asia, are struggling to recover.

Within the US market, there are also notable trends. The 493, a group of high-quality stocks, has outperformed the broader market, demonstrating resilience and strong fundamentals. The consumer discretionary sector remains undervalued, offering potential investment opportunities. The healthcare sector has exceeded expectations, with companies that meet or exceed earnings targets being rewarded with significant stock price gains.

However, the media and entertainment sector faces a mixed outlook. While there is optimism about future growth, challenges posed by AI spending could impact the ability of companies to meet heightened expectations.

Overall, investors need to carefully consider these regional and sectoral trends when making investment decisions. While some markets and sectors offer promising opportunities, others may face headwinds that could limit their performance.


Resources
With EasyEquities 3.0, you can now browse investments in several themes that align more easily with your investment goals. 


So whether you're looking for healthcare sectors, income-generating investments, or something to hedge against inflation, we have a theme to suit you. Simply browse through the options, select the theme that interests you, and you’ll see a curated selection of investments that fit the bill.

You’ll find these on the app by tapping on My Investment, My Way, and scrolling down to the bottom. Here you’ll find Hot Themes and many additional themes to explore.


Whatever the theme or category, you’ll find that there are several options to help you in your investing research. The perfect investment opportunity awaits – and now it's easier than ever to find it.

If you want to explore further, you may want to check out AI Baskets. This new feature allows you to personalise and build your own basket using AI.

Browse available baskets
 Just head over to your Invest screen, tap Invest with AI Technology, then scroll down until you come across the Browse Categories section.


How to buy an available AI basket
Once you’re ready to purchase an existing basket and have made your desired adjustments, you can tap the red Buy This Basket button where you’ll be directed to the section where you can enter the investment amount and complete the purchase. 

Remember: AI Baskets are only available to invest in your USD account, so make sure you have some funds available in that wallet.

Build your own basket with AI
If you’d like to create a basket using AI - it’s just as easy! Simply give our clever system some investment ideas and it will translate them into investment opportunity options, putting the power of artificial intelligence to work for you.

Head on over to our Easy3.0 course to learn more.

Want to know more about the latest news?

S&P 500's 493 Stocks Reach New Highs

What Rate Cuts Mean for Global and Local Markets

Are AMETFs the Next Big Thing in Your Portfolio?

JSE Gains Momentum Amidst Economic Optimism

1 Easy Way I Took Advantage of a Country's Booming Growth
Trends Shaping the Unit Trust Sector in 2024

Frans Cronje on South Africa's GNU: Key Takeaways for Investors



Any opinions, news, research, reports, analyses, prices, or other information contained within this research is provided by an external contributor as general market commentary and does not constitute investment advice for the purposes of the Financial Advisory and Intermediary Services Act, 2002. First World Trader (Pty) Ltd t/a EasyEquities (“EasyEquities”) does not warrant the correctness, accuracy, timeliness, reliability or completeness of any information (i) contained within this research and (ii) received from third party data providers. You must rely solely upon your own judgment in all aspects of your investment and/or trading decisions and all investments and/or trades are made at your own risk. EasyEquities (including any of their employees) will not accept any liability for any direct or indirect loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from use of or reliance on the market commentary. The content contained within is subject to change at any time without notice.

 

Any opinions, news, research, reports, analyses, prices, or other information contained within this research is provided by an employee of EasyEquities an authorised FSP (FSP no 22588) as general market commentary and does not constitute investment advice for the purposes of the Financial Advisory and Intermediary Services Act, 2002. First World Trader (Pty) Ltd t/a EasyEquities (“EasyEquities”) does not warrant the correctness, accuracy, timeliness, reliability or completeness of any information (i) contained within this research and (ii) received from third party data providers. You must rely solely upon your own judgment in all aspects of your investment and/or trading decisions and all investments and/or trades are made at your own risk. EasyEquities (including any of their employees) will not accept any liability for any direct or indirect loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from use of or reliance on the market commentary. The content contained within is subject to change at any time without notice.

Previous Blog

Next Blog

Let Us Help You, Help Yourself

From how-to’s to whos-whos you’ll find a bunch of interesting and helpful stuff in our collection of videos. Our knowledge base is jam packed with answers to all the questions you can think of.