As Wall Street debates the recent speculation that AT&T Inc. (NYSE:T) is interested in acquiring Time Warner Inc (NYSE:TWX), FBR analyst Barton Crockett is out today with his insights.

AT&T and Time Warner have recently met “to discuss various business strategies including a possible merger,” Bloomberg reported yesterday. Discussions are still in early stages, according to anonymous sources. “The talks, which at this stage are informal, have focused on building relations between the companies rather than establishing the terms of a specific transaction, the people said, asking not to be identified as the deliberations are private.”

Crockett sees some logic in this merger, noting, “AT&T’s market cap of close to 3x Time Warner’s suggests capacity for a deal, even if it is mainly stock vs. cash. Clearly, any offer would have to top the $85 per share, $70 billion bid from Fox in 2014 that Time Warner rejected. But AT&T has already taken a step down the road of buying more exposure to video, with the 2015 deal to buy DirecTV for $48 billion. AT&T is reportedly planning for a day when its DirecTVNow online video service to debut later this year will supplant the satellite service as its main video offering to consumers. Owning TWX, which has a leading movie studio/library, and a leading direct to consumer video service in HBO, could give AT&T more freedom to innovate new windowing and content production and release strategies for digital video, and also provide a hedge on rising content costs.”

Crockett rates Time Warner shares a Hold, with a price target of $81, which represents a potential downside of 9% from where the stock is currently trading.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Barton Crockett has a yearly average return of 2.8% and a 48.5% success rate. Crockett has a 19.4% average return when recommending TWX, and is ranked #879 out of 4183 analysts.