Now is not the time to buy

ITV cashed in this weekend on what has become one of the biggest UK television events of the year, reportedly bagging £25m in advertising revenues from the X Factor final.

But does the reality TV boost mean that investors should be rushing to scoop up the firm’s shares? Its stock has climbed to over 73p – above even its April highs after the hiring of new CEO Adam Crozier. It now trades at a 11.7 times price-to-earnings ratio – only marginally below its sector average.

The channel’s recovery also looks to be on fairly solid footing: the numbers for this year were a vast improvement on last, with pre-tax profit jumping from a £105m loss for the first half of last year to a £97m gain for the same period this year. Earnings per share for the same period recovered from a 1.8p loss to a positive 1.8p (unadjusted).

But even so, there are likely to be hiccups along the way, which means that there will probably be better opportunities to pick up stock than in the wake of ITV’s X Factor moment.