Why Scripps Network Interactive, Inc. Shares Jumped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Scripps Network Interactive, were riding higher today, gaining as much as 14% on reports it could be taken over.

So what: Last night, the entertainment magazine Variety reported that Discovery Communications was considering making an offer for the parent of television networks, including Travel Channel, Home & Garden TV. The deal seems to be just a thought at this point and several analysts said that it wasn't worth buying up the stock on a hypothetical, especially without a dollar amount attached to it. Analysts have noted that that would seem to be beneficial only if Discovery plans on expanding Scripps' presence abroad.

Now what: TV companies have spiked this year as broadcast networks compete for limited spectrum, and production companies such as Discovery and Scripps find themselves being suited by streaming providers such as Netflix as that new channel has opened up a brand-new revenue source. Without an amount to attach to any offer, though, bidding up Scripps's shares seems completely speculative. I'd tread carefully.

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The article Why Scripps Network Interactive, Inc. Shares Jumped originally appeared on Fool.com.

Fool contributor Jeremy Bowman has no position in any stocks mentioned. The Motley Fool recommends Scripps Networks Interactive. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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