Westhouse Securities downgrades ITV on share price strength

30th Jul 2014 13:37

Westhouse Securities has downgraded ITV to 'add' from 'buy' to reflect the strength of the broadcaster's share price.ITV's pre-tax earnings before interest, tax, depreciation, amortisation and one-off items (EBITA) in the six months to June 30th rose 11% to £322m.The group said on Wednesday it saw clear opportunities for investing in growth in programmes, online, pay TV and advertising, with an increasing emphasis on international programme production and distribution.Westhouse said ITV's fundamental attractions included the breadth of its programme portfolio, its ability to provide advertisers with a big TV audience, quality management and good cash flow.It added that it believed the acquisition by Virgin Media owner Liberty Global of BSkyB's 6.4% stake highlighted the group's strategic value.ITV's current valuation suggested about 11% total return upside to the broker's 220p target price, but some short-term profit taking was possible, it said.The broker's Roddy Davidson said: "We are moderating our recommendation from 'buy' to 'add' to reflect recent share price strength."Shares in ITV had fallen 2p or 1% to 203p by 12:45 in London.PW