The constant chatter of cord cutters and millennials adopting more internet-based media consumption habits haven’t stopped the old-guard media companies from continuing to rake in a pretty penny from its share of the market.
Tech companies, especially in the U.S., have struggled to match those capabilities. Take Facebook (FB) for example – the tech giant has grown ad revenues impressively in recent years and made savvy acquisitions, however one of its biggest offerings generates no revenue. Facebook Messenger doesn’t draw money and its an area that U.S. tech firms haven’t been able to keep up with their Asian competitors. Tencent Holdings (HKG) averages $7 a user from its WeChat service and hasn’t tapped into a few major remaining markets.
Fortunately, in the world of ETFs we need not choose either/or. The fact is that with half the waking day currently being won by these two sectors there is only room to grow revenues. An ETF that weights these industries heavily is PowerShares’ Dynamic Media ETF (NYSEarca: PBS) which is up 6.8% in the last month and 7.8% on the year. After dipping well below both its major trend lines it has pushed above its 50EMA and is testing its 20o. PBS allocates over half of its composition to broadcast and entertainment heavyweights to capture the stability of the pay TV revenues while also including exposure to the new-guard tech players such as Facebook to capture their growing relevance.
The opinions and forecasts expressed herein are solely those of Remzi Gokmen, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.