Janus Capital Corp., the huge mutual fund and longtime cable investor, has been rejiggering its cable portfolio by shedding shares of MSOs like Adelphia Communications Corp., Cox Communications Inc. and Comcast Corp., and snapping up stock in programming companies.
Janus sold 3.3 million Comcast shares and 4.1 million shares of Cox between Sept. 30 and Dec. 31, according to documents filed with the Securities and Exchange Commission.
The mutual funds also sold their entire stake in Adelphia, totaling about 1 million shares.
At the same time, Janus substantially increased its position in Liberty Media Corp. It added more than 19.9 million Liberty shares in the period.
Also during that time frame, Janus bought 6.8 million shares of USA Networks Inc., added another 6.2 million Class B supervoting shares to its Viacom Inc. holdings and purchased 5.9 million shares of MSO Charter Communications Inc.
The funds also purchased 4.4 million shares of The Walt Disney Co., boosting its holdings to 34.2 million shares, and 2.5 million shares of Rainbow Media Group stock, making it the programmer's largest institutional shareholder, with 8.1 million shares.
Janus Capital finished the year with 28 million shares in Charter, 90.6 million shares in Viacom and 90.7 million shares in Liberty.
AOL SALES MADE NEWS
Janus came under scrutiny earlier this month, after an article in The Wall Street Journal
reported the firm shed almost 32 million shares of its AOL Time Warner Inc. stock in the fourth quarter — as its executives praised the media and technology company.
While Janus has not been as vocal with respect to its holdings in MSOs and other programmers, most observers see the mutual fund's moves as a mixture of taking advantage of depressed programming stocks and diversifying its portfolio.
"They probably think there is a better way to play the ad recovery," said one investment banker who asked not to be named.
And even though Janus has sold some of its long-time holdings, it still is the largest institutional shareholder in Comcast, with 92.4 million shares, and in AOL Time Warner, with 183 million shares. Janus also holds about 15.3 million shares of Cox.
Janus vice president of public relations Jane Ingalls, through an assistant, declined to comment, citing the company's policy against discussing specific trades of stocks.
Ingalls did make an exception for the Journal, though, telling the newspaper that Janus had sold some AOL shares — and some other technology stocks — "as we've broadened the portfolios out."
Janus has had a rough time in the past two years. Its mutual funds have lagged the Standard & Poor's 500 Index, mainly because of their heavy concentration in technology stocks.
AOL Time Warner may have fallen out of favor with the Janus funds because its not the growth stock it used to be.
Shares of AOL Time Warner have dipped about 46 percent over the past 12 months, mainly because of sluggish growth in its online unit and pressure on its various media divisions from the declining advertising market.
But market speculation is that the giant mutual funds' cable sales are not over.
"You can read something into what they were doing in the fourth quarter, but the real story will be when their first-quarter numbers come out," said one analyst who asked not to be named. "I don't think you'll see that they were adding to their positions in the first quarter. There has been a lot of volume [in cable stocks] in this quarter."