This week's Barron's cover feature focuses on 10 stocks it calls bargains. Among them is CBS (CBS/NYSE), which I own:
Big media stocks are out of favor on Wall Street as investors worry about a slowdown in advertising spending and an ongoing shift in ad dollars to the Internet from traditional media. With its TV, radio and outdoor businesses, CBS is as old-media as they come. The company also is well managed and its stock looks like a bargain at 24, down from a summer high of 35. It trades for just 12 times projected 2008 earnings of $2 a share. CBS is one of the media sector's best dividend plays with a yield of 4.2%. The secure dividend, now $1 annually, is likely to continue to rise. CBS may be a slow-growth story, but it probably trades at a marked discount to the sum of its parts, which could be worth at least $35 a share. CBS's 84-year-old chairman, Sumner Redstone, is eager to reward shareholders.
I'll add that Les Moonves, who runs CBS on a daily basis, is a driving force here. He loves the idea of taking a "boring, old media company" and rewarding shareholders. It's a challenge, and as Barron's points out, the stock is down since last summer.
But that dividend feels especially good in this environment. I remain a holder.
Would you care to exchange links with Successful Trading Tips at http://www.financialfuturesandequitymarketanalysis.com/
Just let me know at johnbougearel@gmail.com
Kind Regards,
John Bougearel
Posted by: John Bougearel | January 28, 2008 at 05:37 PM
John: I don't exchange links, sorry. Just blog as often as you can and you'll be surprised how many people will link to you. My impression is that asking for links posting others' sites or by email is bad form, but I may be wrong. In any event, happy blogging and here's wishing you all the best.
Posted by: John | January 28, 2008 at 09:48 PM
"Les Moonves, who runs CBS on a daily basis, is a driving force here. He loves the idea of taking a "boring, old media company" and rewarding shareholders."
One way to reward shareholders is to provide more balance in news coverage.
Posted by: Austin fitness trainer | January 31, 2008 at 09:06 AM
Austin: Put me down for more accuracy in news coverage. But I don't think the CBS news division will make or break the profitability of CBS as an investment.
Posted by: John | February 01, 2008 at 12:18 AM
Like your blog style. Currency trading is the futures - no pun intended.
Posted by: online trading brokers | September 04, 2008 at 06:58 AM