Hey, Belo, Maybe It's Time for a Split?
Yesterday, the Dow Jones-published Barron's suggested that Belo Corp. ought to bite the bullet and just separate its broadcast and newspaper divisions, echoing last week's advice from Citigroup analyst Eileen Furukawa. The way Barron's figures it in this subscription-only story, TV stocks are hot and newspapers are not, and if Belo were to bite the bullet and just do the smart, inevitable thing, it might see its shares jump by as much as 30 percent.
Belo's stock shot up last week, after Furukawa upgraded the stock from "hold" to "buy" and upped her share price target from $19 to $25 because of its good TV reception. The stock opens the week at $22.22 after hitting a 52-week high last Thursday of $22.94 -- a full eight bucks higher than where it sat as recently as September 11 of last year. Says Barron's: "TV stocks are back, partly because private-equity firms are paying top dollar for operators of stations that carry...network programming." Only problem is, says Barron's and anyone who knows Belo, the bigwigs and bosses on South Record have always said they don't want to split the biz. But for 30 percent mas, maybe...? --Robert Wilonsky