While Malcom X may have said, “The media’s the most powerful entity on earth”, these days, the sector is looking a bit frail – at least when it comes to stock returns. Hollywood’s writers and actors strike, lower consumption of traditional media properties and a host of other factors have made the sector less attractive than it once was. The question for portfolios is whether the major media players deserve a spot in your portfolio.
The answer isn’t so easy to see.
Difficulties remain for some of the major media stocks. However, there have been some bright spots. Social media and digital producers of content are thriving, while some legacy providers may still have some life left. In the end, investors could find that media stocks still offer some potential if the valuation is right.
