| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 437.33 | 4278 |
| Intrinsic value (DCF) | 7.22 | -28 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 694.66 | 6854 |
Starz Entertainment LLC (NASDAQ: STRZ) is a leading provider of premium subscription video programming in the United States and Canada. Operating in the competitive entertainment sector under Communication Services, Starz delivers its content through over-the-top (OTT) platforms, the STARZ-branded app, and multichannel video programming distributors (MVPDs). Headquartered in Vancouver, Canada, the company has carved a niche in the streaming wars by focusing on high-quality original programming, including hit series like 'Power' and 'Outlander.' With a market capitalization of approximately $1.39 billion, Starz competes in a rapidly evolving industry where content differentiation and direct-to-consumer (DTC) strategies are critical. Despite challenges in profitability, the company maintains a strong revenue base of $4.02 billion, supported by its hybrid distribution model. Starz’s ability to leverage its brand and content library positions it as a key player in the premium streaming space, though it faces intense competition from larger media conglomerates and tech-driven platforms.
Starz Entertainment presents a mixed investment profile. On one hand, its $4.02 billion revenue and $396.8 million operating cash flow demonstrate robust top-line performance and cash generation capabilities. However, the company’s net loss of $1.1 billion and negative EPS of -$4.72 highlight significant profitability challenges, likely due to high content costs and competitive pressures. The lack of dividends and substantial total debt of $3.46 billion further weigh on its appeal. Investors may find value in Starz’s niche content strategy and hybrid distribution model, but the risks—including intense competition from deep-pocketed rivals and the capital-intensive nature of content production—warrant caution. The stock’s beta of 0 suggests low correlation with the broader market, which could appeal to certain portfolios, but the absence of profitability metrics tempers enthusiasm.
Starz operates in a fiercely competitive landscape dominated by streaming giants and traditional media powerhouses. Its competitive advantage lies in its targeted content strategy, focusing on premium, often genre-specific programming that appeals to dedicated fanbases. Unlike broader platforms, Starz has successfully cultivated a loyal subscriber base through shows like 'Power' and 'Outlander,' which differentiate it from competitors. However, its smaller scale compared to rivals like Netflix or Disney+ limits its ability to invest in expansive content libraries or global expansion. The company’s hybrid distribution model—spanning OTT, MVPDs, and its proprietary app—provides revenue diversification but also exposes it to the declining pay-TV market. Starz’s high debt load further constrains its ability to compete aggressively in content spending. While its brand recognition and curated content slate offer some insulation, the lack of a diversified revenue stream (e.g., advertising, merchandise) leaves it vulnerable to subscriber churn and pricing pressures. To sustain growth, Starz must balance content investment with debt management while exploring strategic partnerships or niche acquisitions.