No Clear Odds on Likelihood of Discovery/Scripps

Analysts are split on the likelihood of Discovery Communications joining with Scripps Networks. Credit Suisse analyst Omar Sheikh in a note to investors Wednesday called the reported deal talks unlikely to come to fruition since previous such talks probably died due to disagreements over price and structure, and those hurdles seemingly haven't changed. A combination would have more negotiating leverage with MVPDs and advertising agencies, he said. Citi's Jason Bazinet said the idea of Discovery/Scripps talks is "credible," adding the two likely will come to an agreement due to the pressures on the cable industry and to low valuations. He said a combined entity would have more leverage with emerging digital distribution platforms like Hulu, Sling, Vue and YouTube, and also make the launch of a non-sports bundle easier. Neither Scripps nor Discovery commented Wednesday. Scripps stock closed at $76.89, up 14.7 percent, while Discovery closed at $27.18, up 4.3 percent. Scripps also reportedly has held merger talks with Viacom. Viacom didn't comment.