John J. Edwards III
In an otherwise quiet market, the upgrade of
to buy from market perform at
Donaldson Lufkin & Jenrette
has lent some strength to the
Nasdaq Composite Index
, while the
Dow Jones Industrial Average
is wafting higher on evenly distributed component gains. "It's probably a function of a quiet day and some people covering shorts to try to square up for the weekend," a trader said.
A great deal of that short covering is no doubt centered on
, which has bounced 1 3/4 to 18 3/4 on news of a management shakeup in its broadcast operations. As of May 15, Westinghouse had the 10th-largest short interest on the
New York Stock Exchange
at 24,587,540 shares. That's up a hefty 4,602,380 shares from the previous month.
Investors are squeezing the shorts with their pleasure at the resignation of Peter Lund as president and chief executive of the
broadcast and cable TV division. He is to be replaced by Mel Karmazin, the well-regarded head of
and Westinghouse's single-largest shareholder since the merger of his
into CBS last year.
Suzanne Betts, an analyst at
Goldis-Pittsburg Institutional Services
in Garden City, N.Y., said the Karmazin ascension should be decidedly positive for the No. 2 TV network. "If you take a look at Infinity, their margins have always been leading the industry," Betts said. The challenge now is to bring the same managerial magic to CBS, just in time for its planned September spinoff from Westinghouse's creaky industrial operations.
Betts is betting that the Karmazin move and the tighter focus made possible by the spinoff will help the broadcast group jump out of the doldrums that Westinghouse shares have been mired in. The 52-week high is 21 1/8, while the 52-week low is 15 3/8 -- a narrow range that reflects Wall Street's lack of interest in the shares. Betts sees the stock returning to the low 20s by December, then heading to 28 over the next two years. Goldis-Pittsburg has done no underwriting for Westinghouse.