Cable Stocks Hold Steady
Dow Drops 231 Points
By Mike Farrell -- Multichannel News, 10/21/2008 12:43:00 PM
Cable stocks stayed relatively stable Tuesday as the Dow Jones industrial average had another down day, with Cablevision Systems losing the most ground while other stocks managed to keep their gains and losses in the single-digit range.
The Dow lost 231.77 points on Tuesday to close at 9,033.66. This came a day after a 413-point gain in the Dow on Monday.
Tuesday’s decline was driven by big drops in technology stocks—the tech sector dropped about 3.9% on Tuesday, according to a report in the Wall Street Journal—and uncertainty surrounding the upcoming earnings season.
While other stocks faltered as investors feared that corporate profits will be worse than expected that helped the cable sector. Several analysts have argued that the cable earnings for the third quarter—which begin to trickle out next week—should be robust despite the downturn in the economy.
But not everyone was immune. Cablevision Systems, thought by most analysts to have the strongest fundamentals in the cable sector, fell $1.04 per share (5.5%) on Tuesday, mores on fears that the credit crunch may prevent it from selling off assets. Only two operators ended the day on a positive note – Time Warner Cable finished up 22 cents (1.1%) to $20.46 and Charter Communications was unchanged at 46 cents each.
The other operators fell slightly, with Comcast down 61 cents each (3/8%) to $15.36 and Mediacom Communications down 4 cents (1%) to $4.35 per share.
Satellite TV serve provides also showed slight declines—Dish Network fell 15 cents each (1%) to $16.33 per share and DirecTV Group was down 7 cents to $22.20 each.
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