This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

News Corp Rides Bull Market Despite Ratings Dip

Stocks in this article: NWSA TWX VIAB

Indeed, News Corp revenue from affiliate fees for U.S. pay-TV carriers increased 13% in the quarter ended Dec. 31 whereas U.S. advertising rose 8%. Haverty's Gabelli Global Multimedia Trust, a closed-end fund that holds News Corp shares, is up 23% over the past 12 months.

Not everyone, though, is seeing roses. All the market cheer is making Hal Vogel, an investor and longtime media industry observer, uneasy and a bit frightened. Vogel likes News Corp and has nothing but good things to say about Murdoch and COO Chase Carey. His concern is with a bull market that's been "artificially fueled" by a Federal Reserve buying $85 billion in bonds each month while keeping interest rates "ridiculously low."

The U.S. grew a mere 1.5% last year after expanding 2.4% in 2010 and 1.8% in 2011 as unemployment has stood stubbornly at around 8% or higher, Vogel said. The payroll tax is up and gasoline prices have been rising. Inflation holds at 1.9%, though Vogel is among the crowd who claims that figure is being low-balled.


"The Fed, the European Central Bank and now the Japanese are trying to pump up their economies giving the illusion that things are really improving," Vogel said in a March 25 interview. "The Fed's policies are creating tremendous inflation. At best this points to sluggish growth, and at worst, we're headed for a sharp change of direction in the stock market."

If the market does turn downward, Vogel forecasts advertising will fall sharply, and even higher affiliate fees won't be enough to compensate for the decline.

"When it turns, it will be violent and it will be quick," Vogel warns, "because a lot of this market has been supported by central bank actions that are becoming less and less effective."

Any market that has gained 131% from its low in March 2009 will have its collection of naysayers. But while Haverty acknowledges that News Corp and media stocks generally have benefitted from investors borrowing at low interest rates and investing in the market, he doesn't see doomsday.

2 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs