Shares of major U.S. media companies rallied on Monday, after the Federal Reserve's decision to bail out mortgage finance companies Fannie Mae and Freddie Mac, according to analysts, Reuters reported.

Walt Disney Co., News Corp. and DreamWorks Animation SKG Inc. shares were up more than four percent, while Time Warner Inc., Viacom Inc. and CBS Corp. increased nearly three percent on the New York Stock Exchange.

“The Fed's move potentially removes some of the extreme downside scenarios that could spill into the general economy. These stocks have been significantly out of favor recently so I think you are getting a little bit of relief on that,” said Christopher Marangi, associate portfolio manager at GAMCO Investors, according to Reuters.

"The economic outlook seems to have gotten a little better because of the Freddie and Fannie bailout. There may be some feeling that (a fourth-quarter) contraction may not be as severe (as previously forecast)," according to Standard & Poors analyst Tuna Amobi.

Dropping oil prices and stronger dollars could also buoy media stocks, according to analysts.

“Lower oil prices means you will have higher discretionary spending, and media and entertainment falls under consumer discretionary," said Caris & Co analyst David Miller.

Amobi gives a "strong buy" rating on Disney, a "buy" on News Corp, a "neutral" on DreamWorks and Time Warner shares, and a "sell" on CBS and Viacom shares.

However, GAMCO has a "hold" on CBS and Disney shares, and a "buy" on Viacom, Time Warner and News Corp shares.

According to Marangi, all the major U.S. media companies were trading "at significant discounts to their private market values, or what an informed buyer would pay for a business," Reuters reported.