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Canadian streaming television content provider Thunderbird Entertainment Group will be one of those companies that will emerge mostly unscathed by the corona virus and, if anything, come out the other end thriving.

With the world and its children stuck at home, demand for Netflix, Amazon and Hulu has been on the rise, creating a more devoted fan base particularly for original series and documentaries.

The Thunderbird Entertainment share price has oscillated between CAD1.45 at the beginning of the year and a low of CAD 0.68 in March on the back of the more general market panic, but has gradually started making its way back up as it becomes clear that it is positioned to survive the corona crisis well and to do even better going forward.

According to Netflix about 60% of the material that is being watched is family-friendly programming, one of Thunderbird’s fortes as some of its most recognizable franchises include the sitcom Kim’s Convenience Store, a series about a Korean-Canadian family running a shop in Toronto which has just aired its fourth series on Netflix, Canadian road rescue documentary Highway Thru Hell, and animated programmes The Last Kids on Earth and Beat Bugs.

Demand for streaming content has never been higher

Demand for original streaming content has never been as high as now when Disney+ and Apple started challenging the dominance of the more established Netflix and Amazon and capturing larger audience numbers.

To help them differentiate from one another, they are ploughing larger budgets into original content; Netflix for instance plans to allocate over $17 billion in 2020, up from $15 billion in 2019 and $12 in 2018.

The competition in this space will only become more fierce, benefiting providers like Thunderbird as the larger budget will be directed their way. Thunderbird actually counts Disney and Netflix among its biggest customers.

Popularity of the programmes will be a key factor and it is telling that all of Thunderbird’s factual programming has been recommissioned for new series this year.

How has Thunderbird Entertainment coped with the coronavirus?

The company tackled the obstacles created by the spread of the virus head on, migrating its staff to work from home rather than in their offices in Vancouver, Toronto, Ottawa and Los Angeles. So far Thunderbird Entertainment has held on to all of its staff and it will need them as it brings 13 productions on line this year – all of them proceeding on schedule.

Two key factors will help the company through the corona pandemic: it holds intellectual property rights on all the programmes it produces, which means that part of the income will not only come from streaming rights but also associated merchandise and, in the case of The Last Kids on Earth, a game based on the series.

The plus factor is that unlike companies that film on set, Thunderbird can continue working, uninterrupted by social distancing measures, particularly in the animated division.

Social distancing has thrown a spanner in the works for filming set-based television shows and filming of a large number of television shows has been cancelled, creating a programming gap that will be felt in the autumn. This scheduling gap will have to be filled with other material, creating demand for content providers like Thunderbird and yet more growth opportunity for this Canadian stock.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Vanya Dragomanovic

Vanya Dragomanovic

Vanya is an award-winning financial journalist who has worked in both television and newswires. She spent over 10 years at Dow Jones covering commodity markets, including metals, coffee, cocoa and oil. She also reported from the floor of the London Metals Exchange, and appeared on CNBC to discuss international metals markets. Since then she has written for several leading financial publications, including serving as commodities editor for FTSE Global Markets.

Vanya continues to cover international commodities markets globally, specialising in particular on metals and alternative energy. She is also the author of a book on CFD trading.

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