CBS Stock Slumps on Ratings Downgrade

CBS stock is trading lower this afternoon following a ratings downgrade to 'sell' at UBS earlier today.
By Rachel Graf ,

NEW YORK (TheStreet) -- Shares of CBS (CBS) - Get Report are declining 2.88% to $56.27 in mid-afternoon trading on Friday after UBS cut its rating on the stock to "sell" from "neutral."

The firm maintained its $52 price target on shares of the New York City-based media giant.

CBS stock has advanced so far this year given strength in national TV advertising and optimism about management's long-term estimates for re-transmission consent revenue and CBS All Access and Showtime OTT subscribers, UBS wrote in a note cited by CNBC.com.

But the macro backdrop doesn't support continued TV advertising strength, and national TV advertising will likely decelerate in the second half of this year, excluding the Olympics, the firm added.

Earnings growth for 2017 will probably be weighed down by tough Superbowl and political comparisons, and investors should price in relative cyclical risk to macro and network ratings, UBS noted, according to the Fly.

Separately, TheStreet Ratings team rates the stock as a "buy" with a ratings score of B.

CBS' strengths such as its revenue growth, notable return on equity, impressive record of earnings per share growth, increase in net income and good cash flow from operations outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

You can view the full analysis from the report here: CBS

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author. 

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