This Day On The Street
Continue to site
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

News Corp Rides Bull Market Despite Ratings Dip

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

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

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

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
VIAB $40.77 -0.34%
NWSA $13.63 -1.23%
TWX $71.10 -1.77%
AAPL $112.76 -0.47%
FB $89.43 -1.74%

Markets

Chart of I:DJI
DOW 16,528.03 -114.98 -0.69%
S&P 500 1,972.18 -16.69 -0.84%
NASDAQ 4,776.5080 -51.8170 -1.07%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs