NEW YORK (TheStreet) -- Cablevision Systems (CVC) shares are retreating -0.8% to $19.38 in early market trading on Wednesday after analysts at Citigroup (C) downgraded the company's shares to "sell" from "neutral".
The downgrade comes one day after the company announced a 15 cent per share quarterly dividend to be paid September 5.
The company's new rating coincides with Citigroup analyst Jason Bazinet's prediction last March that the company would be put up for sale within 18 months.
TheStreet Ratings team rates CABLEVISION SYS CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate CABLEVISION SYS CORP (CVC) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we find that the stock has experienced relatively poor performance when compared with the S&P 500 during the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CABLEVISION SYS CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, CABLEVISION SYS CORP increased its bottom line by earning $0.48 versus $0.25 in the prior year. This year, the market expects an improvement in earnings ($0.87 versus $0.48).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 656.1% when compared to the same quarter one year prior, rising from -$16.14 million to $89.76 million.
- The gross profit margin for CABLEVISION SYS CORP is rather high; currently it is at 50.94%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.69% trails the industry average.
- In its most recent trading session, CVC has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- You can view the full analysis from the report here: CVC Ratings Report