Televisa Earnings: A Tough Competitive Environment Continues to Limit Growth

Televisa delivered weak results during the second quarter as it worked through the Sky integration and faced a very difficult competitive environment. We are cutting our fair value estimate to $5 per share from $6.50 as we push out expectations for meaningful broadband price increases beyond 2025 and incorporate a weaker peso. America Movil’s Telmex business appears determined to gain market share, using low pricing to do so. This dynamic reinforces our view that Televisa does not possess an economic moat, but we believe the current stock price assumes the market will show little improvement in the coming years. While that outcome is possible, we expect consolidation will eventually occur.