Evaluation of companies in media and entertainment business. Theoretical models of company evaluation and practical application on major US media companies

Table of Contents

• 1. Introduction
  • 1.1. Study goals and research question
  • 1.2. Media and entertainment market overview
• 2. Literature review
  • 2.1. Company ratio analysis
    • 2.1.1. Asset-position ratios
    • 2.1.2. Financial risk and liquidity ratios
    • 2.1.3. Earnings and profitability ratios
  • 2.2. Company evaluation with Discounted Cash Flows
  • 2.3. Company evaluation with multiples
  • 2.4. Company share indicators analysis
  • 2.5. Media and entertainment companies' valuation specific
  • 2.6. Technical stock analysis
• 3. Empirical research
  • 3.1. Introduction of the companies
    • 3.1.1. Companies overview
    • 3.1.2. Data
  • 3.2. Method and Procedure
  • 3.3. Results
    • 3.3.1. Country analysis
    • 3.3.2. Industry analysis
    • 3.3.3. Company analysis
      • 3.3.3.1. Application of ratio analysis
        • 3.3.3.1.1. Asset-position ratios
        • 3.3.3.1.2. Financial risk and liquidity ratios
        • 3.3.3.1.3. Earnings and profitability ratios
    • 3.3.4. Application of Discounted Cash Flows
    • 3.3.5. Application of multiples
    • 3.3.6. Application of share indicators analysis
    • 3.3.7. Media and entertainment companies' evaluation specific ratios
    • 3.3.8. Fundamental analysis summary
    • 3.3.9. Application of technical stock analysis
    • 3.3.10. Analysis summary and answering the research questions
• 4. Discussion
  • 4.1. Critical overview of the main findings
  • 4.2. Further implication

Objectives and Key Themes

This master's thesis aims to determine if the current share prices of six major US media companies (21st Century Fox, CBS, Comcast, Viacom, Time Warner, and The Walt Disney Company) reflect their intrinsic value and which company presents the best investment opportunity. The study uses financial statements from 2016 to analyze these companies through various methods.

• Company Valuation Techniques: Exploring and applying different methods for evaluating company worth, including ratio analysis, discounted cash flow analysis, and multiples.
• Investment Decision-Making: Assessing the investment potential of the selected media companies based on the financial analysis.
• US Media and Entertainment Market Analysis: Examining the broader context of the US media and entertainment industry.
• Financial Statement Analysis: Utilizing financial statements to extract key financial performance indicators.
• Technical Stock Analysis: Incorporating technical analysis to identify optimal investment timing.

Chapter Summaries

1. Introduction: This chapter sets the stage for the thesis, outlining the study's goals and research question: whether current market prices of major US media companies reflect their intrinsic value and which company offers the best investment opportunity. It also provides a brief overview of the media and entertainment market.

2. Literature review: This chapter reviews existing literature on company valuation methods. It covers ratio analysis (asset-position, financial risk, and profitability ratios), discounted cash flow analysis, multiple valuation methods, share indicator analysis, and aspects specific to media and entertainment company valuation. It also introduces technical stock analysis as a tool for timing investments.

3. Empirical research: This chapter presents the empirical research conducted. It introduces the six selected US media companies and the data used, detailing the methodology employed. The results section presents a country analysis (US), an industry analysis (global media and entertainment market), and a company-specific analysis using the valuation methods outlined in Chapter 2. The chapter culminates in a fundamental analysis summary and the application of technical stock analysis, ultimately answering the research questions.

4. Discussion: This chapter offers a critical overview of the main findings from the empirical research, discussing the implications of the results and suggesting avenues for future research.

Keywords

Company valuation, financial analysis, intrinsic value, market value, investment decision, US media and entertainment business, ratio analysis, discounted cash flow, multiples, share indicators, technical stock analysis, 21st Century Fox, CBS, Comcast, Viacom, Time Warner, The Walt Disney Company.

Frequently Asked Questions: Master's Thesis on US Media Company Valuation

What is the main research question of this master's thesis?

The thesis aims to determine if the current share prices of six major US media companies (21st Century Fox, CBS, Comcast, Viacom, Time Warner, and The Walt Disney Company) reflect their intrinsic value and which company presents the best investment opportunity.

What companies are analyzed in this study?

The study analyzes six major US media companies: 21st Century Fox, CBS, Comcast, Viacom, Time Warner, and The Walt Disney Company.

What period does the data cover?

The financial statements used in this analysis cover the year 2016.

What valuation methods are used in this thesis?

The thesis employs several company valuation techniques, including ratio analysis (asset-position, financial risk, and profitability ratios), discounted cash flow analysis, multiple valuation methods, and share indicator analysis. It also incorporates technical stock analysis.

What are the key themes explored in the thesis?

Key themes include company valuation techniques, investment decision-making, US media and entertainment market analysis, financial statement analysis, and technical stock analysis.

What is the structure of the thesis?

The thesis is structured into four chapters: Chapter 1 (Introduction) sets the context and research question. Chapter 2 (Literature Review) examines existing literature on company valuation. Chapter 3 (Empirical Research) presents the methodology, data, and results of the analysis. Chapter 4 (Discussion) critically reviews the findings and discusses their implications.

What types of ratio analysis are used?

The ratio analysis includes asset-position ratios, financial risk and liquidity ratios, and earnings and profitability ratios.

Does the thesis include a literature review?

Yes, Chapter 2 provides a comprehensive literature review covering various company valuation methods, including those specific to media and entertainment companies.

What is the scope of the industry analysis?

The industry analysis focuses on the global media and entertainment market.

Does the thesis consider technical analysis?

Yes, technical stock analysis is used to help determine optimal investment timing.

What is the conclusion of the thesis?

The conclusion is presented in Chapter 4, summarizing the findings and their implications, answering the research question of whether the current market prices reflect intrinsic value and identifying the potentially best investment opportunity among the chosen companies. It also suggests avenues for future research.

What are the keywords associated with this thesis?

Company valuation, financial analysis, intrinsic value, market value, investment decision, US media and entertainment business, ratio analysis, discounted cash flow, multiples, share indicators, technical stock analysis, 21st Century Fox, CBS, Comcast, Viacom, Time Warner, The Walt Disney Company.