×

Viacom, Other Media Stocks Get Respite After Two-Day Bloodbath

Stocks of several big media conglomerates recovered slightly in Friday morning trading, after the sector sloughed off more than $60 billion in market value over two days — a selloff panic spurred by new signs the pay-TV biz is in systemic decline.

Viacom led peers in the group, recouping some losses with the stock up as high as 6% in the early session. But its shares had plummeted more than 13% Thursday, after the media company reported lower revenue and profits on a 9% drop in ad sales in its MTV Networks group because of declining ratings.

Time Warner and 21st Century Fox also were trending up Friday, with shares increasing 2.3% and 2%, respectively, in early trading. Scripps Networks Interactive and AMC Networks likewise inched up in early trading.

Disney opened slightly higher, before declining about 0.5% in mid-morning. CBS, which closed up 3.6% Thursday after posting earnings that beat Wall Street expectations, was down more than 2% in the Friday a.m. session. Discovery Communications was down about 2% (after closing up 3.5% Thursday).

The tumultuous week for media companies — which some observers saw as an overreaction by jittery investors — was triggered by Disney’s lowered forecast for expected increases in cable affiliate fees for networks including sports juggernaut ESPN.

Indeed, with the selloff in Time Warner shares, analyst firm MoffettNathanson on Friday upgraded the stock from “neutral” to “buy,” with a $96-per-share target (20% above Thursday close). If the pay-TV bundle disintegrates, Time Warner is well positioned, analyst Michael Nathanson wrote in explaining the upgrade: Time Warner’s HBO “is one of the few brands — along with ESPN — that can operate in an a la carte world… HBO Now is showing signs of early momentum and provides long-term upside with international expansion.”

Meanwhile, U.S. cable, satellite and telco TV providers collectively lost more than 350,000 video subscribers in the second quarter, compared with 151,000 in the year-ago period.

While Q2 is seasonally the weakest quarter for the pay-TV sector, the higher losses indicated that cord-cutting is not only a real phenomenon but that it appears to be accelerating. That trajectory has concerned investors, even given that the numbers remain comparatively small given the universe of approximately 100 million U.S. pay-TV households.

More Biz

  • Smoke haze covers the Sydney Harbour

    Australia's Seven West to Merge With Affiliate Prime Media

    Australia’s Seven West Media has agreed a deal to acquire regional broadcast group Prime Media. The move is a further step in the consolidation of Australia’s traditional media industry. The two companies announced on Friday that Seven will make the acquisition entirely through the issue of new shares to the owners of Prime. Both companies [...]

  • Ron Meyer

    Ron Meyer Files $10 Million Suit Over Forged Rothko

    NBCUniversal Vice Chairman Ron Meyer has filed a $10 million suit against two art dealers, claiming they sold him a forged Mark Rothko painting in 2001. Meyer accuses Susan Seidel and Jaime Frankfort of duping him into buying the work. According to the suit, he was told that it would be included in an official [...]

  • Former movie producer Harvey Weinstein (L)

    Harvey Weinstein Seeks to Call Expert on 'Recovered' Memories at Rape Trial

    Harvey Weinstein’s attorneys are seeking to call an expert on “recovered memories” at his trial on rape and sexual assault charges. The defense has filed a motion asking to call Deborah Davis, a psychologist and professor at the University of Nevada at Reno. Davis is a frequent defense witness. She co-authored an article in 2006 [...]

  • Tekashi 6ix9ine Docuseries Coming From Showtime

    Tekashi 6ix9ine Docuseries Coming From Showtime and Rolling Stone

    Showtime Documentary Films today announced a new limited docuseries profiling controversial rapper Tekashi 6ix9ine. Titled “SuperVillain” and inspired by the Rolling Stone feature written by Stephen Witt, the three-part series will trace how a New York City deli clerk named Daniel Hernandez became superstar rapper Tekashi 6ix9ine — who racked up 2.6 billion streams and [...]

  • Fader Label Logo

    Fader Label Signs Two New Acts, Boosts Staff

    The Fader Label, home to Clairo, Matt and Kim and others, announced two new signings today along with three new hires on its staff. Charlie Burg and Zachary Knowles have joined the label’s talent roster, while Carson Oberg has come aboard as general manager, Yasmine Panah as project manager and Josh Hymowitz as label coordinator. They [...]

  • CBS HEADQUARTERS

    CBS-Viacom Merger Details Revealed, Shares to Trade on Nasdaq

    Negotiations between CBS and Viacom went down to the wire on the day the long-gestating transaction was finally sealed on Aug. 13. CBS Corp. and Viacom revealed the timeline of the merger talks in a Securities and Exchange Commission filing on Thursday that runs more than 650 pages. Also Thursday, CBS and Viacom said the [...]

  • Nile Rodgers and Merck Mercuriadis

    Hipgnosis Songs Raises Another $295 Million

    Hot on the heels of its deal to acquire a catalog of 108 Timbaland copyrights, Hipgnosis Songs has raised another $295 million (£231 million) — putting its total to nearly $800 million to date. According to the announcement, a total of 231,000,000 C Shares have been placed by Nplus1 Singer Advisory LLP  and J.P. Morgan [...]

More From Our Brands

Access exclusive content