Shares of Italo broadcaster Mediaset Tuesday plunged 5% — their biggest one-day fall of the year — with analysts blaming weakening ad revenues.
At one point shares in the company, controlled by Italian Prime Minister Silvio Berlusconi, were trading 7% down, before making a slight recovery. They closed at e3.98 ($6.28).
Analysts said concerns over ad sales and doubts about the company’s ability to reposition itself as a content provider sparked the slide.
Earlier this year Mediaset’s advertising chief Giuliano Adreani had made confident noises about ad revenues, which he said were up 3% in the first quarter and “might get better.” But an in-depth analysis of Mediaset produced by Deutsche Bank in May said that ad spending outlook for the year was “disappointing.” DB analyst Alessandro Bai-Badino predicted “more difficult trading” for the rest of the year.
The growing nervousness was underpinned this week by figures from Istat, the Italian government’s statistics office, showing weak growth in the economy.