Sky Upgraded on Dividend Cancellation

Sky announced it won’t pay its final dividend of 22p per share, but analysts have upgraded their fair value estimate for Sky’s shares 

Allan C. Nichols, CFA 8 August, 2018 | 8:16AM

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Morningstar equity analysts are increasing their fair value estimate for Sky’s (SKY) shares to £14.75 per share from £14.53 to equal Comcast’s full offer price as Sky announced it won’t pay its final dividend of 22p per share.

We now model a roughly £4.5 billion takeover premium beyond what we believe the business is worth on its own. The market continues to trade higher than the current offer, betting on a continued bidding war. However, it is becoming increasingly difficult to justify higher prices, in our opinion.

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About Author

Allan C. Nichols, CFA  is a senior stock analyst and international investing specialist with Morningstar.

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