Top analyst sees bleak future for TV stocks

Big broadcast media companies have been performing better than expected for decades, but that won't stop the inevitable economic decline looming for the television industry, analyst Todd Juenger said Thursday.

The Sanford Bernstein senior media analyst told CNBC's "Squawk Box" the conditions that have been driving the TV business for years, bringing in 30 to 40 percent returns on invested capital, simply cannot be sustained through the rise of digital engagement.

"What's at the top of my list is actually more opportunity to the downside, I'm afraid, than the upside. My view is that the future is actually fairly bleak for most of my companies," said Juenger, ranked No. 1 on the Institutional Investor All-American Research Team this year.

Topping his list of positive investment opportunities is Nielsen, the global information company that provides media companies with statistics on their viewership and consumers.

Because the company is involved with media data-gathering but not directly tied to television production, Juenger said he believes Nielsen will continue to grow steadily and eventually "compound nicely for investors."

On the flip side, Juenger gave Viacom an underperform rating, despite news of the media conglomerate possibly looking to merge back with CBS.

"Our view is that in the digital consumption environment, … the economic returns for success in that business are far inferior to the returns that Viacom used to be able to enjoy, when 100 million households paid $3 or $4 a month, every month, for Viacom networks whether they want them or not," Juenger said.

Now, consumers' options for streaming video are hugely diversified, and according to Juenger, that means cable television will soon slip through the cracks. In the case of Viacom, this will happen even if CBS finds a way to keep its "storied portfolio of brands" like MTV and Comedy Central alive.

"We think Viacom is going to get paid by fewer subscribers and going to earn a lot less advertising revenue, even if somebody is able to do the very tough task of keeping their brands relevant," he said.