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Cablevision's Dividend Dance

CEO James Dolan won't discuss a possible payout plan.



rallied Monday even as the cable company deflected Wall Street's dividend demands.

The stock surged 6% after the Bethpage, N.Y., company posted

strong growth across its businesses early Monday. The company also

nailed down a big credit line.

That announcement, made after the close Friday, led investors to speculate that Cablevision will revive a big

shareholder-payout plan that was scuppered by a covenant violation. The failure of the earlier special dividend plan hammered Cablevision shares two months ago.

On a late-morning earnings conference call Monday, CEO Jim Dolan made it clear the company wouldn't discuss the dividend issue. In response to one question, Dolan said the board is considering the dividend, "But there is no guarantee it would move forward with that, or move in any direction."

Earlier Monday, Cablevision posted a solid performance in the fourth quarter across nearly all categories, including subscribers, adjusted profit and phone customer additions.

Cablevision also said on the conference call that it isn't seeing much impact from



fiber-optic expansion effort to offer a triple play of video, phone and Net connections. The executives estimate that Verizon's Fios offer has been taken by about 2% of the customers in Cablevision's market.

"They are building a me-too product at a great expense," said executives on the conference call.

Separately, Verizon

lowered its first-quarter earnings target Monday and announced a $1 billion share-buyback program.

On Friday, Cablevision's refinancing brought in a $2.4 billion secured credit line, fueling speculation over the on-again off-again dividend.

In December, the company cancelled a planned $3 billion dividend and a $1 billion financing deal after revealing that it was in violation of loan covenants related to an earlier credit line. With a 20% stake in the company, the Dolan family would have reaped about $600 million in dividend proceeds.

In late January, the company said it was in compliance with all of its debt agreements, and noted that its board is expected to reconsider a special dividend at its regularly scheduled meeting in March.

Cablevision shares rose $1.46 to $26.66, while Verizon was up 58 cents to $34.39 in midday trading Monday.