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| Friday, November 20, 2009 |
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ANALYSIS
March 2, 2009
Sagging Index no longer reflects what’s going on in the market, some say, Replacements? Google it, to start.
March 2, 2009
Downward price spiral will actually boost the cost of capital for most companies. CFOS, take note.
March 2, 2009
The latest bailout at AIG could be a preview of how the president will deal with Wall Street.
March 2, 2009
No corporate defaults. Big debt offerings. Percolating CP issuance. Things may be looking up in the capital markets.
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March 4, 2009 4:01 PM ET
(Crain’s New York Business)—CBS Corp., which last month reported a 52% drop in profit in the fourth quarter, was upgraded to neutral by one analyst on Wednesday, thanks to the cheap price of the stock and management’s decision to slash its dividend by 80%. The upgrade, however, came with a giant caveat. Pali Research analyst Richard Greenfield wrote that while the company’s finances had improved with the dividend cut, he was still troubled by what he called the actions of Sumner Redstone, CBS’ executive chairman. The analyst accused Redstone of delaying the dividend cut because of his own money woes. Citing “multiple sources connected to current CBS board members,” Greenfield wrote that Redstone “resisted other board members’ desire to cut the CBS dividend for a substantial period of time, which jeopardized the well-being of CBS, in favor of his own personal financial needs.” Redstone has been struggling since October to restructure $1.6 billion in loans owed by National Amusements, the holding company through which he controls Viacom and CBS. The plunge in both companies’ stock price tripped a loan covenant that forced Mr. Redstone to sell more than $200 million in nonvoting shares. The dividend cut took a big bite out of Redstone’s income stream, reducing the amount of money he took home from CBS to $14 million a year from $78 million, according to the Wall Street Journal. Last week Redstone came to an agreement with his lenders that gives him until 2010 to pay off his debts. A spokesman for Redstone did not return a call seeking comment. A CBS spokesman declined to comment. Asked about the dividend cut at the recent Deutsche Bank media and telecommunications conference, CBS Chief Executive Leslie Moonves insisted that the chairman supported the move. “He saw, as we did, we needed the cash,” Moonves said. “It was the right thing to do for the shareholders. And Sumner was right there.”
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