Recently, I recommended you buy Trifecta Stocks holding Disney (DIS). Meanwhile, just announced was the purchase of Carmike Cinemas (CKEC) by AMC Entertainment Holdings (AMC), which would create the largest movie exhibition company in the country. Now is a good time to pay attention to the entertainment industry, as it is doing well and is well priced.
I have just identified a couple of additional investment opportunities in this sector worth your consideration: AMC Networks (AMCX) and Starz (STRZA), both cable television networks. AMC's brands include BBC America, AMC and SundanceTV, while Starz has Starz and Encore.
My recommendations rely on a number of automated investment strategies I created that are based on the strategies of well-known, highly regarded investment gurus. One of these comes from the writings of Joel Greenblatt. This strategy, in the 10-plus years since I have been following it, has produced an annualized return of 5.8%, beating the 4.5% provided by the S&P 500 for the same time period. You would do well to pay attention to this strategy's recommendations -- and it currently likes these cable networks.
Greenblatt's strategy is an interesting one in that it includes only two variables, namely earnings yield and return on total capital. The strategy is also unusual in that it ranks companies from among all publicly traded firms. First, it ranks each company by each of these two variables, and then combines the variables into its final ranking. Only companies in the top 50 from among the thousands of publicly traded companies earn a recommendation.
AMC and Starz both make it into this top-50 group: AMC is ranked No. 29 and Starz No. 23. Well run with strong brands and well-priced stocks, both companies could provide an Emmy-winning performance to your portfolio.