Broker snap: 'Buy on the dip' at ITV

12th May 2011 13:26

RBS advises to "buy on the dip" at terrestrial broadcaster ITV as monthly trading improves."June advertising is weak, it's unclear to what extent driven by the tough year-on-year [comparators] or a deteriorating UK macro picture," the broker said.ITV is guiding to 6% advertising growth in April (below previous guidance of 8-12%), -9% in May and a decline of 15-20% in June. With RBS expecting the World Cup comparator to have an effect in July, and August being a small month for advertising, "trading in September will become a focus" (with the rugby world cup starting on 9 September).Full year net advertising revenue growth forecasts have been cut from 4.5% to 2%, leading to an 8% earnings per share downgrade and reduction in the target price to 115p, from 125p. A 'buy' is kept.---BC