Analyst boosts expectations for CBS


After hearing the Fox TV stations group revenue results from News Corporation, Barclays Capital analyst Anthony DiClemente has raised his stock price target for CBS, which reports its results February 18th.

Fox and CBS are the two largest US TV station group owners. So, based on better-than-expected results and pacings for the Fox stations, DiClemente has raised his target price for CBS stock to $17 from his previous $13, which CBS had already crossed.

The analyst noted that the Fox stations reported revenues up 6% in the October-December quarter – well above expectations. That bodes well for CBS, where DiClemente had been expecting a decline of 8%. For the current quarter, he had been modeling for the CBS TV station group to be “flattish,” but the analyst now says that is “likely too conservative,” given the report from News Corp. that the Fox stations are pacing up 18-19%.

“Positive TV station pacings likely bode well for other local media, including both radio stations (where CBS is 2nd largest owner and we are expecting only flattish radio revenue in Q1) and outdoor advertising (both CBS and Lamar benefit from upside to outdoor which is by definition later cycle in nature,” DiClemente told clients.