Seaport upgrades AMC Networks to Buy on possible privatization opportunity

As previously reported, Seaport Research analyst David Joyce upgraded AMC Networks (AMCX) to Buy from Neutral with an $11 price target The firm thinks AMC Network’s ongoing free cash flow generation will continue to enable significant debt reduction and argues that streaming and content revenues can help to manage continued subscriber losses impacting affiliate and advertising revenue. The de-leveraging path, high level of cash on hand, and free cash generation “could possibly create a privatization opportunity that could increase the leverage ratio by less than one turn,” argues the analyst, who cites both the low valuation of the shares and “an attractive risk/return opportunity” if such a corporate transaction were to materialize for the upgrade.