Shares in BET Holdings hit a 52-week trading high Thursday and could rise further in the near term thanks to a bullish chart pattern and several ambitious expansion moves.
BET owns Black Entertainment Television, a cable network that Nielsen estimates reaches upward of 37 million cable households or 60% of all U.S. cable households and 90% of black cable households.
BET shares are trading around 25 times 1994 profit forecasts of 80 cents a share — not cheap by any means, but below peers such as Gaylord Ent. (at $ 29. 88, 45 times estimated ’94 net).
On Thursday, BET stock rose as high as $ 20.25 per share — a level it hadn’t even approached since mid-October — before closing down 13 cents at $ 20.
The stock’s successful emergence from its rut in the upper teens sets the stage for a run as far as $ 22 or $ 23 a share in the next six months, barring negative fundamental developments, according to Kemper Securities chief market analyst Gregory Nie.
BET, which also operates BET Action Pay-Per-View and publishes two magazines, “Young Sisters & Brothers” and “Emerge,” declined to comment on stock or earnings forecasts.
Last month, BET reported net profits for the first 1994 quarter ended Oct. 31 rose about 31% to 18 cents a share as revenues jumped 37% to $ 23.66 million.
In a recent report, Chapman Co. analyst H. Bernard Dorshow, who rates BET “modestly attractive,” voiced concern that the money-losing magazine business will continue to drag on the bottom line.
BET recently announced a slew of new projects, including one with Home Shopping Network to produce a video retailing program with the goal of a full-time shopping service.
It also established separate joint ventures with Encore and Blockbuster Entertainment Corp. to fund the production and distribution of black-oriented films.