After reading the numbers from General Electric and listening to the company’s quarterly conference call, Wells Fargo Securities analyst Marci Ryvicker found good news for both Comcast and CBS Corporation in the Q2 results at GE’s NBC Universal.
Since Comcast is in the midst of a deal to acquire a majority stake in NBCU from GE, Ryvicker was impressed by the Q2 numbers for NBCU. “We see significant sequential improvement in the NBCU assets, which makes the timing, structure and cash outlay of the deal that much more attractive to us. We expect the transaction is likely to close Q1 2011 with minimal material concessions,” she said in a note to clients.
“Second, as it relates to CBS – we are even more comfortable with our +25% TV station growth (Q2) given that the NBC station group was +25% in the quarter. As a whole, NBC was +1% in revenues with profits +6%,” Ryvicker said. She also noted that Gannett, which is not a stock she covers, also reported Friday that Q2 TV station revenue was up 19.6%, with Q3 pacings in the mid-20s. Ryvicker said the Gannett station group has 25% revenue exposure to CBS affiliates and 58% NBC, according to its SEC filings for 2009.
On the cable side, the analyst noted that revenues were up 7% in Q2, with operating income up 10%. The strength came from USA, Bravo, Oxygen and CNBC.
