Continuing the “Bear” essentials


It’s been an exciting and disconcerting time lately for employees of Bear, Stearns & Company. In the latest move, JP Morgan Chase increased its takeover offer from the original bargain basement bailout value of two bucks a share to 10 bucks. Still a far cry from where it was at the beginning of this month, around 80 bucks, before Bear Stearns encountered a liquidity crisis and had to get a bailout from JP Morgan, with the blessing of the US Federal Reserve. JP Morgan has now also agreed to buy a 39.5% stake in Bear Stearns at the 10 bucks price, which should help blunt shareholder discontent with the buyout offer.

Meanwhile, employees are continuing to come to work and do their jobs. In a conference call for clients reviewing the firm’s recent media conference in Florida, analyst Victor Miller assured those listening that he and his team would “continue to produce the best research we can for you.”

As for the takeaways from the conference, Alexia Quadrani said executives of the ad agency companies that she covers were “surprisingly upbeat” about ad spending trends in the face of the current turmoil in the US economy. Newspaper company executives were, however, less upbeat.

Miller said national advertising is the “most aggravating part” for broadcasting companies, with the auto sector still soft. He noted that the trading multiples for television companies are barely higher than for radio companies, but he said the TV companies have a lot more plusses, including political revenues and retransmission consent payments. In his view, LIN and Belo have the most upside of the TV stocks. In radio, Miller thinks there is still take-out potential for Cox Radio. And he thinks the deal to take Cumulus Media private will get done, but at a price closer to 10 bucks that the original proposal of $11.75.

RBR/TVBR observation: Hey, if our vote counts for anything, please keep Vic on the job covering broadcasting stocks. The sector is so out of favor that the entire contingent of Wall Street analysts focused primarily on broadcasting stocks could easily fit in a single New York City taxi.