Will Shares In ITV plc Outperform Vodafone Group plc, BT Group plc, SKY PLC And Talktalk Telecom Group PLC After Results?

Are shares in ITV plc (LON:ITV) (LSE:ITV.L) a better investment than shares in Vodafone Group plc (LON:VOD) (LSE:VOD.L), BT Group plc (LON:BT.A) (LSE:BT.A.L), SKY PLC (LON:SKY) (LSE:SKY.L) and Talktalk Telecom Group PLC (LON:TALK) (LSE:TALK.L)?

ITV plc
ITV plc

Shares in ITV plc (LON:ITV) (LSE:ITV.L) have gained 0.4% following the release of its 2016 results to the stock market. Investors may be encouraged by a good performance from the media company. Its strategy of rebalancing the business and strengthening its operations has continued.

ITV was able to increase revenue and adjusted profit in spite of a 3% decline in spot advertising revenues resulting from wider political and economic uncertainty. In my view, this is a good sign for its investors, since it shows ITV’s strategy is working well and it could have an impact on its share price in my opinion.

Total external revenue was up 3% to £3064 million, while adjusted EBITA was 2% higher at £885 million. I believe the company has the capacity to invest across its business in order to deliver sustainable returns for investors. ITV Studios is on track to deliver good organic revenue growth in 2017, while Online, Pay and Interactive are expected to perform strongly in 2017. ITV expects to outperform the TV ad market in 2017, while £25 million of incremental cost savings are set to be delivered in the current financial year.

Dividends per share have risen 20% in the year to 7.2p per share. ITV has also proposed a special dividend of 5p per share, which I feel demonstrates the confidence it has in its future.

In the last 3 months, shares in ITV have risen 20%. That’s ahead of TMT peers Vodafone Group plc (LON:VOD) (LSE:VOD.L), BT Group plc (LON:BT.A) (LSE:BT.A.L) and Talktalk Telecom Group PLC (LON:TALK) (LSE:TALK.L). BT’s shares have slumped 7%, Vodafone’s share price has risen 5% and Talktalk is up 13%. However, ITV’s performance is behind the 29% rise in the share price of SKY PLC (LON:SKY) (LSE:SKY.L).

In my opinion, ITV’s shares could perform well on a relative basis and I think it has investment appeal. I feel it is a lower risk option than BT or Talktalk, due to the changes taking place at those companies. However, I believe Vodafone’s shares may have the most growth and dividend appeal. But for the long term, ITV’s shares could continue to hold their own in a competitive TMT industry in my view.

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