Cable stocks fell hard for the second time in three days, this time after Verizon Communications introduced a new pricing plan that offers its Fios broadband service for just $25 per month when coupled with its 5G wireless product. 

To some analysts, the new Verizon plan isn’t as much a ploy to gain Fios broadband customers as it appears to be a move to beat back competition from cable broadband, MoffettNathanson senior analyst Craig Moffett said in an email message. But he fears the price drop — less than half the $50 to $60 per month cable operators charge for broadband — will be bad news for all involved.

“It’s bad for everyone, most obviously Altice, but it’s also a bad sign for Verizon itself,” Moffett said of the Fios price drop in an email message. “I suspect it’s not so much to sell more Fios — Fios is doing fine — but instead to try to protect against wireless losses versus the cable bundle. It’s bad for cable because Verizon had been talking about RAISING Fios pricing as recently as May, but it’s also probably a sign that their wireless business is just continuing to get worse … and worse … and worse.”

Investors suspected the same. While Verizon was relatively flat — it closed at $48.34 each, down less than 1%, cable stocks fell hard on Thursday. Altice USA, the cable company with the most exposure to Fios, dropped the most: Its shares traded as low as $7.58 (down 17.6%, or $1.62 each) on Thursday, a new 52-week low, before rallying slightly to close at $7.88 per share, down 14.4%.

Other cable stocks weren’t hit as hard, but a combination of market forces — the Dow Jones Industrial Average closed Thursday down 740 points — and continued fears of a broadband slowdown put pressure on shares. Charter Communications finished the day at $415.35, down 7.5%, while Cable One closed at $1,171.52, down 5.6% and Comcast closed Thursday at $37.91, down 5.5% each. 

Cable wireless has been gaining steady ground over the past several quarters, with Comcast and Charter combining for more than 7 million customers. Altice USA has had less luck on the wireless side — Optimum Mobile added just 12,000 customers in Q1 and has a total of 198,000 subscribers as of March 31. But the company has been aggressive with discounts. It began offering unlimited data at $30 per line recently and has offered steep discounts on phones, and is in the midst of a massive rebranding effort.  

Also: Bears Take a Bite Out of Cable Stocks, Too 

There is little doubt that Verizon is going after cable companies with its newest wireless plan. According to the plan, new customers would get Verizon’s entry-level Fios 300 Megabit per second home service, basic 5G Home and LTE Home service, but only if they also subscribe to one of three ultimate mobile plans — 5G Play More, 5G Do More or 5G Get More mobile plans — which cost about $50 per month. 

“At a time when the cost of almost everything seems to be going up, Verizon is offering home internet at a price you'll love,” the company said in a press release. “With this new offering, the price is the price, guaranteed. So, ditch cable and switch to Verizon Home Internet with absolutely no regrets.”

While Verizon is urging consumers to ditch cable, it looks like the slowdown in broadband subscribers could start to pick up some speed in Q2. 

Also: Has Cable Broadband Hit the Wall? 

Charter chief financial officer Jessica Fischer, speaking Wednesday at the Credit Suisse Communications conference, said that a “small portion” of customers that had been part of the Federal Communications Commission’s Emergency Broadband Benefit program have not made the transition to its Affordable Connectivity Program. 

The EBB was launched last May, a $3.2 billion program established by Congress as part of a larger COVID-19 aid package. The EBB offered eligible households a subsidy of up to $50 per month ($75 per month on tribal lands) for broadband service and a one-time award of up to $100 for a computer or tablet. 

The ACP was launched in January, part of the Biden administration’s infrastructure package, offering a subsidy of up to $30 per month ($75 on tribal lands) for broadband service and $100 toward purchase of a laptop, desktop or tablet computer.  

But according to Fischer, not as many EBB customers made the transition to ACP, either because they failed to opt in to continue service or didn’t meet qualifications, particularly the one that required them to use the service each month. As a result, Fischer said that between 60,000 and 70,000 former EBB customers will be removed from Charter's subscriber rolls.

Fischer said Charter still expects to add broadband customers in Q2, even with fewer EBB customers, and that the outlook is that broadband is “absolutely still a growth business.”

Whether other cable companies will see the same effect from the ACP transition remains to be seen. But it is yet another uncertainty in what has been a year of uncertainties for the sector. ■ 

Snap shares plunged 43.1% on Tuesday after the company voiced concern that economic issues could slow the growth of its ad revenues and earnings.

Other companies in the ad tech sector also saw their stocks fall on the news.

Late Monday, Snapchat filed an 8K with the Securities and Exchange Commission announcing that the economic environment has deteriorated faster than expected since the company discussed its expectations for the second quarter and issued guidance to Wall Street that revenues would be up 20% to 25%. 

“Even though our revenue continues to grow year-over-year in the second quarter, it's likely that revenue and EBITDA will come in below the low end of our guidance range," the company said. 

“It’s certainly something that we're working through along with many other businesses that are impacted, of course, by the supply chain issues, inflation, concerns about interest rates, the war in Ukraine,” it said.

Snap shares dropped by $9.69 a share to close at $12.79.

In addition to Snap, other online advertising companies saw their stocks tumble.

“When thinking about the impact of the open-internet, since the announcement, we've had the opportunity to talk with 10 public and private ad-tech vendors and the general consensus was that the announcement came as a surprise. We have not heard any comments that align around deteriorating conditions but would note that Snap was the first name to report in the space on 4/21, which may have led to the differing perspective,” said analyst Matthew Swanson of RBC Capital Markets.

“More broadly, public and private vendors alike agreed that the macro remains challenging, but that they are not seeing a worsening environment. This was consistent for both brand and performance-based advertisers that we talked with as well as companies with varying degrees of geographic, format and vertical exposure,” Swanson said.

In the media sector, Steven Cahall of Wells Fargo identified several companies that could be impacted by an ad slowdown caused by macroeconomic factors. 

Comparing the current situation to the 2020 ad recession, Cahall said, "If this time is similar it likely means that within our coverage CTV (e.g. Roku, Vizio)  and AVOD (e.g. Paramount’s Pluto and Fox’s Tubi) will be hardest hit initially. The length and depth of the recessionary slowdown will determine whether pain makes its way to the longer cycle areas of the ad market.”

Roku was down 13.74% to $79.16, Vizio was down 8.8% to $7.74. Paramount was up 0.11% to $8.78 and Fox was down 5.12% to $30. Warner Bros. Discovery was down 7.82% to $16.86, Disney was down 4.01% to $101.59 and Comcast was up 0.44% to $43.07.

Among ad tech stocks, The Trade Desk was down 18.51% to $42.78, Magnite was down 13.15% to $9.25, and Pubmatic was down 15.85% to $18.37.

Facebook stock was down 7.62% to $181.28. Google was down 4.95% to $110.36 and Twitter was down 5.52% to $35.76.  ■

Paramount Global shares rose more than 15% each on Tuesday after Warren Buffett’s Berkshire Hathaway disclosed that it purchased about 68.9 million shares of the programmer in the first quarter.

Paramount Global shares were trading as high as $32.32 each on Tuesday morning, up 15.2% or $4.30 each. The stock was priced at $31.97 each at 11:45 a.m. on May 17, up 14% or $3.95 per share.

Berkshire Hathaway disclosed the Paramount Global stake as part of the fund’s quarterly 13F-HR filings with the Securities and Exchange Commission. 

While there was no reason given for the purchase, Buffett is known as a value investor and Paramount’s shares were down about 6.5% between December 31 and May 16. The company, which changed its name from ViacomCBS in February, beat analysts’ Q1 expectations, adding about 6.8 million new subscribers in the period in its Paramount Plus streaming service.  ■ 

Shares in WideOpenWest were up as much as 17% in early trading Monday after reports surfaced that the company was in talks with Morgan Stanley Infrastructure Partners to be acquired.

WOW stock was priced as high as $21.69 per share (up 17% or $3.20 each) in early trading May 13. The stock was trading at $20.85 each before mid-day, up 13% or $2.36 each. This is the second time in about a month that WOW shares have risen in the double-digits — in April, the stock rose 12% after speculation arose that it had hired advisers to seek a possible buyer. 

According to Bloomberg News, citing unnamed sources, WOW and Morgan Stanley Infrastructure Partners, the private-equity infrastructure investment arm of the investment banker, have entered into exclusive talks. The Morgan Stanley unit is not a total stranger to the U.S. telecom business — in 2020 it purchased a 49.99% interest in Altice USA’s Lightpath fiber enterprise business in a deal with an implied enterprise value of about $3.2 billion. 

Officials at WOW declined comment. Representatives from Morgan Stanley Infrastructure Partners did not immediately respond to a request for comment.  

WOW is coming off the sale of five of its markets for a combined $1.786 billion to Astound Broadband and Breezeline (formerly Atlantic Broadband) and recently unveiled plans to beef up fiber network deployment and launch a wireless offering. Earlier this month the company said it would spend about $400 million on greenfield expansion of its fiber network through 2027.

On a conference call with analysts to discuss its Q1 results on May 9, WOW said it would launch its mobile service — via a partnership with Reach Mobile — in one of its southern markets later this month, followed by an enterprise-wide launch in Q3. ■

AT&T shares took another hit on Tuesday (February 1), dipping as much as 5% in early trading after the telco giant said it would slash its dividend by nearly half, giving growth investors yet another reason not to own the stock.

And those reasons are beginning to mount up. AT&T has spent the past few years dismantling its attempt to build a mega-media conglomerate, selling large chunks of DirecTV and WarnerMedia for bargain prices. With the dividend cut, AT&T said it will be on the hook for just under $8 billion this year for the shareholder payout, versus $15 billion in 2021. Analysts have been waiting for the dividend cut for a while, which they deemed necessary to help the company shave its enormous debt load. 

Dividend cuts are never good news for shareholders, though, and many have been voting with their feet over the past few months. The stock closed February 1 at $24.42, down 4.2%, or $1.08 per share, as trading volume doubled to 123.6 million shares, compared to the average daily volume of 59.5 million. On Wednesday (February 2), it was down another 1% in early trading to $24.19.

AT&T shares are down about 8% since January 26, when the company released mixed Q4 results, and by more than 20% since it said in May that it would combine its WarnerMedia Group unit with Discovery Inc. That deal, expected to close in the next few months, will pump about $43 billion in cash into AT&T’s coffers and give shareholders a 71% interest in the combined entity.  

AT&T also finally revealed the structure of the Discovery deal: It will be a spinoff rather than a split-off, with AT&T shareholders receiving 0.24 shares of Warner Bros. Discovery (the name of the new entity) for every share of AT&T stock they own. There had been some speculation that investors would be disappointed in a spinoff structure vs. a split-off exchange, but most analysts believed there would have been little chance for the latter structure. 

In a research note January 26, MoffettNathanson senior analyst Craig Moffett wrote that others had argued that there would be a benefit in a split-off structure because it would reduce the number of outstanding AT&T shares, and there was a belief that that would cause the stock’s price to rise. In a split-off, AT&T shareholders would exchange their AT&T shares for stock in the new company, compared to a spinoff, which would give them a percentage of new shares based on their AT&T holdings. Moffett argued the opposite: What the company really needed to do, in his view, was to further reduce the dividend in order to pay down debt more quickly.  

Is The Debt Too Darn High?

“AT&T’s problem isn’t that their promised dividend is too low,” Moffett wrote in his January report. “It’s that it’s too high. The market has already judged it to be unsustainable.” 

What appeared to force some shareholders to the exits Tuesday is that in the spin-off structure, investors get a lower dividend yield. Then AT&T added to the pain by further cutting the dividend from their previous guidance of the “$8 billion to $9 billion range,” settling at a number just under $8 billion.

Later, Moffett said the lower dividend payout was a prudent move and should help them in their ongoing efforts to pare down their $154 billion in long-term debt.   

According to Barron’s, a split-off could have reduced AT&T’s total shares outstanding by as much as 20%. Based on the spinoff structure and the reduced dividend payout, Barron’s estimated AT&T’s dividend yield to be about 6.2%, compared to the previous 8%. That’s still higher than its closest rival, Verizon Communications, with a dividend yield of about 4.8%. 

The drop in the stock price can also be traced to more fundamental reasons. AT&T has been touting its new direction as a pure-play telecom company for months, aggressively discounting wireless service and building out fiber and 5G for broadband offerings. At the end of the fourth quarter, AT&T said it added 884,000 postpaid wireless subscribers and 271,000 fiber broadband customers.  But it became quickly evident that subscriber growth was the result of deep discounting. EBITDA, a measure of cash flow, growth was literally nonexistent, prompting Moffett to use an old movie analogy to bring home the point. 

“Pro forma organic EBITDA growth (adjusting for DirecTV, WarnerMedia and Vrio), despite solid subscriber growth for both wireless and fiber, came in at … 0.0% (paging Mr. Blutarsky),” Moffett wrote in a January 26 note to clients. 

Moffett noted that he had upgraded AT&T to “neutral” in October because he thought the stock was too cheap at the time. Now he says he can’t figure out how the company grows.

That is most evident in a deeper dive into the Q4 numbers. While organic revenue growth of 4.2% in the quarter seems respectable, Moffett wrote that if you pull out wireless equipment and organic service revenue, it drops to 3.8%. Stripping out WarnerMedia and its Latin American digital entertainment business Vrio (sold to Grupo Wertheim in November), organic operating revenue drops to 1%. 

Also: Eureka, AT&T is a Phone Company Again 

“The results were weak, with EBITDA missing in every segment, there is no pro forma growth here whatsoever and guidance was for more of the same,” Moffett wrote in an email message about the stock’s January 26 decline. 

Other analysts agreed. 

Bernstein media analyst Peter Supino pointed to the company’s 3% service revenue guidance, saying it indicated faster ARPU (average revenue per unit) declines than he had marginally modeled, adding in a report that he expects AT&T to dial back promotions. 

In a report titled “Can AT&T Get Out of Its Own Way?,” Barclays media analyst Kannan Venkateshwar expressed his disappointment in the 2022 guidance, adding that AT&T management has the unique opportunity to redefine the company and its investment narrative but the Q4 results were a step back.   

Wireless Worries

“The company has clawed back share in wireless over the last few quarters, is now starting to turn around its wireline business back to growth next year, its spectrum investments have been a lot more balanced than Verizon and pro forma leverage should be a lot more manageable,” Venkateshwar wrote. “However, as demonstrated yesterday [January 26], it remains difficult to underwrite the company's execution path, partly on account of lack of transparency on key drivers.” 

AT&T isn’t alone. J.P. Morgan media and telecom analyst Phil Cusick downgraded Verizon to “neutral” from “overweight” on January 26, citing concerns about postpaid wireless subscriber growth in 2022, warning that Q1’s normal seasonality could make it tough for the telco, and its troubles could extend beyond that period.

So it’s happening all over. Media is hard but so is wireless. And AT&T is perhaps getting singled out because it spectacularly failed at one and is showing signs of slipping with the other. 

There is no question that getting out of the media business is a good idea for AT&T. The high prices paid and the low returns realized from its media dabblings dating back to Tele-Communications Inc. in 1998 have been written about and analyzed ad nauseum. It’s just that the business that it is supposed to know well — wireless telephony — is changing too. More players (cable is encroaching quickly on the mobile front), pricing wars and add-ons like free HBO Max service are ruling the day. For AT&T and its shareholders, the harsh reality is that business is hard. And whether AT&T has the right formula — wireless and broadband — is going to play itself out over time. Hopefully it finds the answer before time runs out. ■   

Netflix stock, down 30% since it missed Q4 subscriber growth estimates and issued weak guidance for the first quarter, got a boost Thursday after hedge fund legend William Ackman’s Pershing Square Capital Management said it has purchased 3.1 million shares worth about $1 billion in the SVOD pioneer, vaulting into the top 20 largest individual shareholders in the company.

Netflix stock was up by nearly 10% to $394.80 each in early trading Thursday -- it was up 7% to $385.44 each as of 11:39 a.m. -- not a huge bump but perhaps the beginning of a reversal of the downward trend in the past few days. Whether Ackman’s investment is a true showing of confidence in the company or just another example of an investor snapping up shares when they are down, remains to be seen. In a letter to shareholders Wednesday, Ackman praised Netflix’s “best-in-class management team.” Later on Twitter, he said he has long admired Netflix chairman Reed Hastings and “the remarkable company he and his team have built.”

Pershing Square financed the Netflix share purchase by unwinding most of its interest rate hedge, which raised about $1.25 billion. 

In his note to shareholders, Ackman said Pershing Square didn’t own a share of Netflix before Friday, and he decided to buy the stock after it fell about 25% on January 21, adding that the hedge fund has been looking at the company for months, along with streaming music company Universal Music Group. 

"Now with both UMG and Netflix, we are all-in on streaming as we love the business models, the industry contexts, and the management teams leading these remarkable organizations," Ackman said in the note to shareholders. 

Ackman’s stance on streaming appears to be contrary to the current consensus, as players like Disney Plus, Paramount Plus, HBO Max and others have seen their early torrid customer growth slow down. 

Also: Did Wall Street Just Give Up on the Streaming Wars?  

But $1 billion from one of the more savvy Wall Street players is nothing to sneeze at. Ackman has made billions over the past several years taking positions that at first were against the conventional investing tide.

Ackman himself said essentially the same in his shareholder letter. 

“Many of our best investments have emerged when other investors whose time horizons are short term, discard great companies at prices that look extraordinarily attractive when one has a long-term horizon,” Ackman wrote.  

Ackman is known as an “activist” investor -- he famously convinced Wendy’s International hamburger restaurants to spin off the Tim Horton coffee shop chain in 2006.  Pershing Square has about $13billion in assets under management in relatively few companies -- Lowe’s, Chipotle Mexican Grill, Hilton  International and Domino’s Pizza are among its biggest holdings. Pershing Square Capital Management gained about 27% last year after a 70.2% rise in 2020. In January, the fund slipped almost 14%, its worst start in years.    

But not all of his investments have been home runs. In 2010, Pershing Square bought about 18% of the J.C. Penney retail chain and sold the stake in 2013 for a $500 million loss. A five-year battle with health supplement maker Herbalife -- in which Pershing had a near-$1 billion short position and had been accused of using a PR campaign and regulatory pressure to keep its stock price low -- ended in 2018 after the fund exited its position in the company.  Later, his misgivings about the company were justified in 2020 after Herbalife agreed to pay about $123 million in fines to settle U.S. Dept. of Justice claims that it bribed Chinese government officials.

Granted, Netflix is not a fast food restaurant, hotel chain  or a home improvement retailer, but Ackman wrote in his note to shareholders that the SVOD giant has a strong position in the market, its recurring subscription-based revenue has “enormous future growth potential,” has economies of scale and a rapidly growing international subscriber base that should continue to increase margins, and has an improving free cash flow profile that should allow for continued growth investment and cash returns to shareholders. 

And he seems to be betting real money on a Netflix turnaround. In his letter to shareholders, Ackman said that by selling its interest rate hedge, Pershing likely missed out on gains as rates rose in the past week. But he has confidence in Netflix’s prospects.

Also: Netflix Bulls No More 

“Had we not sold the hedge, we could have likely realized more gains based on the increase in rates, largely today (January 26), since our sale,” Ackman wrote. “That said, we believed the opportunity to invest in Netflix at current prices offered a more compelling risk/reward and likely greater, long-term profits for the funds.”

Netflix has missed subscriber growth targets before, and has weathered huge swings in its stock price in the past, 

but what seems to have spooked investors and analysts the most recently is the lack of visibility beyond Q1. If Netflix sees such shrinkage ahead in what is traditionally one of its biggest growth quarters -- Q1 subscriber additions have accounted for as much as 45% of total yearly growth in past years -- what does that mean for the rest of the year?

Also: The Netflix Effect 

Netflix isn’t alone in seeing its subscriber growth ease. Disney Plus, HBO Max and Peacock all have experienced a slowdown in the pace they add new customers, just as they are all committing to step up content spending to keep the subscribers they do have. Some analysts have even predicted that streamers will have to make the decision soon to either double down on content spending or sell assets. Netflix appears to be in spend mode -- it spent about $14 billion in 2021, up from about $11 billion in 2020 -- as are Disney Plus, Paramount Plus, Peacock and HBO Max. Only time will tell whether that is money well spent.  

Bernstein Research media analyst Todd Juenger returned to coverage of the industry Monday after a three-month sabbatical, upgrading Discovery Inc. to “Market Perform” from “Underperform,” but cautioning that the programmer, which agreed to merge with WarnerMedia in May, has some heavy lifting ahead.

Juenger took a three month sabbatical beginning on July 30, and Bernstein suspended coverage of media companies in his absence.  The analyst, who joined Bernstein in 2012 after heading up TiVo’s Audience Research business, has proven himself to be one of the more insightful analysts covering the programming space. 

In upgrading Discovery, Juenger also announced that he was dropping coverage of AMC Networks “to focus on stocks with broader investor interest.”

Juenger didn’t pull any punches upon his return. Although he increased his rating on Discovery, he lowered his 12-month price target on the stock to $26 from $28, reflecting his concerns about its ability to integrate the WarnerMedia business.

“[W]e continue to have high conviction that these businesses face a long list of very serious concerns, including: the legacy business is facing insurmountable structural pressure, the streaming future is riddled with risk for this set of brands, including the daunting complications of the WarnerMedia integration and rationalization,” Juenger wrote of Discovery. “However, the market seems to also share those concerns, and has driven the stock price down to a level where we can no longer argue the risk/reward for investors skews significantly negative from here.”

Juenger continued that he believed Discovery’s stock price already reflects the market’s belief that it will miss its streaming revenue guidance, cash flow guidance or both. 

“As the closing date approaches, the key question for investors from a catalyst perspective is: if the company takes down their guide, will that be bad for the stock (confirming tougher business conditions and lower financial results) or good for the stock (clearing the overhang, regaining investor confidence in a believable outlook on which to price the stock)?”

In his report, Juenger points out that Discovery WarnerMedia is not yet the “streaming powerhouse” depicted in headlines, but instead relies almost entirely on traditional linear cable network revenue to fund its streaming endeavors. How it manages to keep that linear business generating cash while its streaming business grows will be critical. 

“Ironically, the more successful the streaming service becomes in the market – the more pressure is put on the linear networks, which is the tyranny of the innovator's dilemma,” Juenger wrote, adding that the new entity will have a leverage ratio of about 5 times cash flow, and has promised to use excess free cash flow to lower debt. 

“We think this puts the company in a very difficult box to start from: promises to both invest in streaming and invest in delevering,” Juenger continued. “It also greatly amplifies risk to equity value. Any downturn in either EBITDA/FCF, or the valuation multiple of the stock, will fall sharply on the equity holders.”

Discovery shares were up more than 5% in early trading Monday to $24.70 each. The stock was priced at $24.52, up 4.6% ($1.08 each) at 12:09 p.m. on Nov. 1.  

Juenger also didn’t want to downplay the massive integration issues the combined company will face once the deal closes.

Integration Issues Loom 

“Which departments survive, which get merged or deleted, who stays/who goes, who's in charge, how to design incentives for leaders of the legacy business and the streaming business, and how to align that market by market, region by region and globally,” Juenger wrote. “All while trying to deliver/exceed on financial synergies promised to the investment community. This complex task will not only require significant expense, but also significant management bandwidth and distraction. And employee trepidation, and time. Important decisions cannot be made before the new leadership is installed (otherwise it undermines the authority of the new leadership).”

Juenger also saw some potential bright spots, including overdelivering on streaming growth and potential synergies. The analyst wrote that the market usually forgives other sins if a company manages to add more streaming customers than expected, and so far most streaming services have. 

In addition, Juenger added that if consumers pare down to three or slightly more than three streaming subscriptions, Warner Bros. Discovery will likely be among them. 

“This view would be supported by a belief that HBO would continue its history of putting forth a handful of truly distinctive premium entertainment series every year, and the addition of Discovery's portfolio would add complementary engagement value,” Juenger wrote.

As far as synergies, Juenger pointed to Discovery’s 2017 purchase of Scripps Networks. Less than three months after closing that deal, Discovery raised its cost synergy target from $350 million to $600 million. 

“One could easily expect Discovery will once again exceed the original target,” Juenger wrote. “Which, theoretically, could be additive to the $14 billion EBITDA guidance (or, give the company that much extra room to invest in streaming, or de-lever).”

Dish Network shares were up more than 3% in early trading Monday after influential media analyst Craig Moffett raised his rating on the stock from “sell” to “neutral” and upping his 12-month price target on the stock to $40 from $15, adding that its recent MVNO deal with AT&T erases the biggest overhang on the shares.

In a research note Monday (July 26), Moffett said the biggest weight on Dish stock had been the 2027 expiration of its MVNO deal with T-Mobile, a deadline that the analyst had said previously would make it difficult for the satellite TV pioneer to build out the remainder of its network after that date. But the AT&T agreement, which is essentially for 12 years, pushes that MVNO agreement out to 2033, giving the company the ability to be a hybrid Mobile Network Operator/MVNO “indefinitely.” 

Dish has said it will launch its first 5G wireless market -- Las Vegas -- in the third quarter. In June it launched a website -- Project Gene5is -- that will provide consumers updated information on the launch and possibly gauge interest in the service in markets outside of Las Vegas. 

Also Read: Cable Wireless Grows Up 

“Now, with the stroke of a pen, all those rakes are off the table,” Moffett wrote. “Dish is virtually assured a path to viability.”

Dish shares responded accordingly, rising as high as $43.41 each (up $1.73, or 4.2%) in early trading July 26. The shares were trading at $43.10 (up 3.4%) at 10:50 a.m. on Monday. 

Moffett has been a critic, along with several other analysts, concerning Dish’s wireless prospects, saying in reports several years ago that the company’s claims it could build a nationwide wireless network for $10 billion was dangerously low.  

Also Read: Dish Wireless Pushes Forward 

Moffett still harbors those fears. In the most recent report he noted that the  AT&T deal won’t help the build out at all (Dish is required by federal mandate to make its network available to 70% of the country by 2023) and he estimated that its $10 billion price tag is still incredibly low. But the AT&T deal removed the worst-case scenario from the table, he added.

But making the wireless business easier for Dish doesn’t necessarily bode well for the remaining wireless players. Although Dish will pay AT&T about 4% billion over the life of the MVNO deal, it also allows the satellite company to pick and choose which markets it will build out itself -- most likely the denser, more profitable ones -- and leave the more sparsely populated areas to AT&T.  

“Good news for Dish is bad news for the industry,” Moffett wrote. “We are incrementally more bearish about AT&T and Verizon, and less bullish about T-Mobile, than we were before.”   

Share repurchases, put on hold during the pandemic, are poised to make a big comeback as cable companies look for places to put their huge stockpiles of cash to better use, according to one influential analyst. 

In a research report, MoffettNathanson principal and senior analyst Craig Moffett wrote that with broadband growth slowing, capital intensity waning and share valuations low, cable operators will likely focus on returning cash to shareholders through stock repurchases. 

Moffett noted that cable is at a unique point in its capital cycle — large-scale infrastructure investments are pretty much no longer needed, margins are rising and major industry consolidation is a thing of the past. 

“The entire cable industry is now in harvest mode,” Moffett wrote.

Most analysts believe that broadband growth will slow in the next few years after a record 2020. But the key is that growth is expected to slow, not stop. And while slower growth would be a problem for the stocks if their valuations were high, that is not the case in the cable industry, where public stocks have been trading well below private deal multiples.

The combination of low multiples, rising margins and declining capital intensity leads to a “geyser” of free cash flow (cash flow after interest payments and capital expenditures are made), Moffett wrote, which then can be used to repurchase shares. 

Share repurchases have been a popular vehicle to return cash to shareholders for years. According to Moffett, Comcast has bought back about 17% of its outstanding stock in the past 10 years, while Charter has reduced its outstanding stock by 34% since closing its Time Warner Cable purchase in 2016 and Altice USA  has repurchased about 37% of its outstanding stock since splitting off from Altice N.V. in 2018. 

But in the past two years, repurchases have declined due to a desire to pay down debt and uncertainty surrounding the pandemic. Comcast, which had been buying back an average of $4 billion to $5 billion worth of shares annually prior to the pandemic, stopped its repurchase program in 2019 as it focused on paring down debt associated with its purchase of British satellite company Sky. 

Comcast’s goal was to reduce its leverage ratio to about 2.5 times cash flow from about 3 times at the time. Comcast has said it expects to reach that target by the end of 2022. As of March 31, Comcast’s leverage ratio was at 2.7 times. 

During its first-quarter 2021 earnings conference call with analysts, the company said it planned to restart that buyback program in the second half of the year. At the JP Morgan Global Technology, Media and Communications conference in May, Comcast chief financial officer Mike Cavanagh said the repurchase program was restarted that month. 

Cavanagh said at the conference that Comcast would repurchase stock at about the same pace it had before halting the program, which has averaged between $4 billion and $5 billion per year. Given the huge amount of cash the company is generating, though, that won’t be enough, Moffett wrote.

By Moffett’s estimates, Comcast is expected to generate about $16 billion in free cash flow in 2022, $18.6 billion by 2023 and $24 billion by 2025. Given average annual operating cash flow increases of about 7.6% over the next five years, even spending all of its free cash flow on stock repurchases won’t be enough to keep leverage at 2.5 times.

In his report, Moffett estimated that if Comcast indeed wants to keep its leverage ratio at 2.5 times, it would have to spend all of the free cash flow it generates plus 2.5 times in each year’s EBITDA growth.

“Based on our estimates, and assuming that they increase their dividend by 10% per year, by 2025 they would need to buy back more than $90 billion of stock, an amount roughly equal to 34% of the company’s current market cap,” Moffett wrote. 

He estimated that over the past 10 years, Comcast has returned about $60 billion in capital to shareholders — $33.1 billion in buybacks and $27.2 billion in dividends. 

Moffett was quick to add that Comcast has not said what it intends to do after 2022 regarding repurchases, and analysts’ consensus estimates predict the company to spend between $8 billion and $9 billion per year buying back its stock. Moffett’s estimates are nearly double consensus estimates at $15 billion to $16 billion. But even at that level, the analyst pointed out that it still falls short of consuming all the cash Comcast is expected to generate. 

“Our forecast for repurchases — again, roughly 2x consensus — represents an 11% decrease in shares outstanding (net of shares issued under employee plans) by 2025, still only a fraction of what they could do,” Moffett wrote. 

Moffett admitted that there are a lot of other things Comcast could do with the money, and speculation has been high it will seek out a major acquisition, despite the company’s claims to the contrary.  But consolidation has largely already happened in the industry, and any future deals are expected to be small ones. In addition, the market, Moffett wrote, would prefer share repurchases or a separation into two separate stocks -- an idea other analysts have floated in the past -- and then even more buybacks.

“Indeed, one can argue that share repurchases are more than just a ‘niceto have,’” Moffett wrote. “Given where Cable is in its life cycle — slowing growth, rising free cash flow — this is arguably the only appropriate strategy, at least from the perspective of institutional investors.” 

Others, like Charter and Altice USA, have maintained or even increased their buyback pace, but are poised to step on the accelerator in 2022 and beyond.

According to Charter’s 10-K annual report, it bought back about 21 million shares of its stock in 2020 for about $12 billion, up about 55% from the 19 million shares it repurchased for $7.8 billion in 2019. The dramatic rise in Charter’s stock price over the periods was a big factor in the amounts spent on repurchases — between Jan. 1 2019 and Dec. 31, 2020, Charter stock rose from $284.97 to $661.55, or about 132%. So far this year, Charter stock is up about 7.4%. 

Charter is different from Comcast in that its current leverage ratio of about 4.4 times is within  its targeted range of between 4.0 and 4.5 times cash flow. But even if it decided to pare its debt just a bit more, Moffett noted it could substantially increase its repurchases.  

“If Charter were to manage to the midpoint of their target leverage range (4.25x EBITDA), our model would imply share repurchases of $66 billion  over the next five years, a sum equal to 47% of today’s market cap,” Moffett wrote. 

Moffett predicts that Charter will spend a little less, about $58.6 billion, on buybacks by 2025, adding that the cable company is not prioritizing capital returns over capital investments. Its participation in the RDOF auction is evidence of that, and the company has said that it would like to own more cable. 

But again, the number of deals available are small given Charter’s size. As the No. 2 cable operator in the country, it has about 16 million video customers and 29 million broadband customers. 

“So cash return not only looks like the best use of capital for Charter… it also looks like the most likely,” Moffett wrote.   

Altice USA has made some small acquisitions — it bought Morris Broadband in April for about $310 million and Service Electric Cable TV of New Jersey in July 2020 for $150 million — while pulling the plug on larger deals like its abandoned joint $8 billion bid for Atlantic Broadband parent Cogeco Communications in November. 

While the operator says M&A is still in the mix, Moffett believes that it won’t be big enough to affect capital returns to shareholders. 

That’s because Altice has been an aggressive buyer of its own stock — it repurchased about $7.5 billion worth of shares since 2018 — and its valuation multiple is low. In addition, Altice has said it would prefer buybacks to paring its debt. Its leverage is currently at about 5.5 times, just short of the targeted 4.5-to-5 times, and Altice believes its stock is cheap.

Altice has only guided its repurchase intentions in the short term and has said it plans to buy back about $1.5 billion of its shares in 2021. Moffett estimates it may buy back about $1.6 billion worth of shares this year, but noted that taking leverage down to about 4.75 times would imply a buyback potential of more than $11 billion through 2025.    

Dish Network stock fell more than 5% Wednesday after JP Morgan media analyst Phil Cusick downgraded the stock, casting doubt on the satellite TV giant’s wireless plans and adding that the one potential bright spot in the strategy is at least two-to-three years off.

Cusick downgraded Dish shares to “underweight” from “neutral,” but raised his 12-month target on the shares from $38 to $45 each, saying that its plans to build a wireless network in the next several years could be extremely costly and that the No. 2 satellite TV service provider enters the market at a time when barriers are high and competition is fierce. 

Dish shares fell as much as 7.3% ($3.16 each) to $40.42 per share on June 9, closing at $40.44 each, down 7.2%. 

“We can’t find a way but to be skeptical on the Dish story,” Cusick wrote. “[W]e have nothing but respect for Dish chairman Charlie Ergen and his team, but can’t get over our skepticism on three major issues.”

Those issues, according to Cusick are the difficulty in building a wireless network, Dish is expected to struggle to compete against wireless carriers with double and triple its spectrum holdings, and fears that Dish may be too late to the 5G game as other carriers have accelerated deployment and eliminated any advantage Dish would have had if it had been first. 

Dish has said it would spend about $10 billion to build a nationwide 5G wireless network based on ORAN technology, a figure that many analysts said is shockingly low. Dish has about one year to make the network available to 20% of the country as part of the federal requirements for its wireless spectrum licenses, and to 70% of the country by June 2023, deadlines the company says will be reached easily but that other analysts are skeptical can be achieved without a partner. Dish has said it will launch service first in Las Vegas in the third quarter. 

Also Read: Dish: No Partner Needed for Wireless Dance 

Some had hoped that partner would be Amazon, and Dish said in April that it picked the e-retailing giant to provide cloud services for its wireless offering. But so far, Dish is expected to build the network on its own. 

In his report, Cusick wrote that the only bright spot for Dish’s wireless endeavors -- a possible partnership with Amazon in some sort of “Prime Wireless” offering -- if it were to occur, is at least two to three years off in the future. 

“What could a ‘Prime Wireless’ offer look like? What would it bring? We think a lot about where we could be wrong, and how Dish could really disrupt the wireless industry,” Cusick wrote, adding that it’s difficult to see how the satellite company could offer disruptive pricing on its own. 

While Cusick says it is possible that Dish and Amazon could mirror what e-retailers Rakuten and Jio have done with wireless -- offering months or years of free wireless service to drive Prime subscriptions -- he still has doubts.

Also Read: Satellite TV: Five Years, That’s All You’ve Got 

Cusick estimated that it could cost Amazon as little as $11 per subscriber per month to offer a Dish wireless service with Amazon Prime, but he wondered “why Amazon would do this until Dish’s network is proven and of sufficient quality. It makes a lot more sense to us, if it happens, 2-3 years from now at earliest.”

Cusick also speculated on a possible merger of satellite TV assets with rival DirecTV, which in February said it would spin off its TV business with private equity firm TPG. He added a deal is more likely to happen now, especially as content providers continue to unleash direct-to-consumer products, but would likely take at least a year to complete.  

Also Read: Dish Gets Back to its Rural Roots

“We believe that a combination of Dish and DirecTV is likely to face substantial regulatory scrutiny should the parties come to an agreement given the rural concentration of the sub base, but we believe that a deal can eventually be approved,” Cusick wrote. “A deal could be announced by 2022, after AT&T's sale of DirecTV to TPG closes, but getting Ergen and AT&T executives to agree on a price is likely to face hurdles.”

Cusick noted that while the 2007 merger of Sirius Satellite Radio and XM Satellite Radio Holdings is often cited when predicting federal approval of a Dish-DirecTV union, it took 17 months for that earlier deal to get the regulatory nod, “despite the stress that the businesses were under.”

After reports identifying what is believed to be one of the main culprits in the precipitous drop in ViacomCBS and Discovery stock over the past several days, shares of both companies continued to take hits, although less damaging than the beating they’ve taken in the past several days. 

ViacomCBS shares were down as much as 10.8% ($5.23 each) on Monday to $43 per share, while Discovery sank as much as 5% ($2.08 each) to $39.82 per share. ViacomCBS stock was priced at $46.44 each, down 3.6% as of 2:10 p.m. Discovery shares were trading at $42.87 each (up 2%) as of the same time Monday.  

But Monday’s drop was nothing like the storm both stocks weathered last week.

ViacomCBS shares fell more than 50% between March 22 and March 26, from $100.34 per share to $48.23 each, spurred by a huge sell-off of shares by hedge-fund Archegos Capital Management, according to reports. Discovery fell 44% in the same time frame, also due mostly to the Archegos sell-off.

The sell-off reached its height on Friday, March 26, when ViacomCBS and Discovery shares fell 27% each. Prior to that decline, the stocks had slipped 33% and 22.6%, respectively, over the prior three days. 

Archegos was formed by former Tiger-Asia hedge fund founder Bill Hwang, who unbeknownst to most investors had accumulated huge positions in both stocks over the past several months, and appeared to be the main reason the shares have enjoyed one of the biggest runs in the sector. Prior to the March 22 sell-off, ViacomCBS stock had more than doubled since January when it was priced at $36.50 each, and was up more than seven-fold in the past 12 months. Discovery was on a similar tear, rising 152% since January and nearly quadrupling during the 12-month period. 

Things started to unravel on March 22, when ViacomCBS announced a plan to raise $3 billion in new and preferred shares for about $85 each, far below its then-current price of $100.34 per share. That announcement forced Viacom CBS shares down 9% on March 23.

While analysts and investors had attributed the past gains in the stocks to increasingly positive sentiment over streaming video efforts from both companies, a report in The Wall Street Journal traced the rise and fall of both stocks to Hwang and the way he invested in the shares with little detection. 

According to some reports, at one point Archegos controlled more than 10% of ViacomCBS and Discovery shares, many through swaps, which are contracts brokered by investment banks that allow an investor to take on the profits and losses of a portfolio of stocks or other assets for a fee. While the assets are held in street name, they are such that they allow the owner to avoid Securities and Exchange Commission regulations that require that a company that owns 5% or more of another public company’s stock reveal those holdings in filings called 13-D registration statements. 

Archegos invested in several other companies, including tech companies like internet search giant Baidu, spreading those swaps across a wide variety of investment banks like Goldman Sachs, Deutsche Bank and Morgan Stanley. Goldman, Deutsche, Credit Suisse, Morgan Stanley and UBS also acted as prime brokers to Archegos, processing its trades and lending it cash and securities, the Journal report said. 

When the stocks began to lose value -- Baidu, for example, had dropped about 20% in mid-March -- the banks had to sell some of the shares to help it post more collateral. That included making large block trades, which by Friday March 26, reached the point where the banks decided to seize the stock Archegos had already used as collateral to cover losses, with some banks deciding to sell their holdings as quickly as possible. Adding to the pressure was the decline in the stock from the March 22 ViacomCBS offering, causing some banks to decide to liquidate their positions as quickly as possible.

That appeared evident by the huge jump in the volume of ViacomCBS shares traded on March 26 -- 211.9 million  -- and in Discovery shares -- 104.4 million -- five to 10 times their volume on the previous day. 

CNBC’s David Faber added that some reports pegged the Archegos position in ViacomCBS and Discovery at as much as 15%, going against what he called a prime brokerage rule among Wall Street funds to cap their interests in companies at 10%. 

“You are supposed to say that you will not own more than 10% of any one company period. Apparently he [Hwang] didn’t listen to those rules and didn’t obey those rules,” Faber said on CNBC's Squawk on the Street. “There are various rules as well. The swap market perhaps is more opaque. It’s unknown to the other prime brokers if you don’t disclose it, what your economic position is with others. He [Hwang} very well may not have been obeying rules set by the prime brokers. ” 

ViacomCBS and Discovery shares sank like a stone Friday afternoon, dropping more than 30% each as the company weathered a string of analyst downgrades, speculation around big insider sales and mounting sentiment that their respective streaming efforts (Paramount Plus and Discovery Plus, respectively) could falter.

ViacomCBS shares fell more than 30% on Friday to $46.28 each, down $20.07 each, after Wells Fargo Securities analyst Steven Cahall downgraded the stock to “equal weight,” and lowered his 12-month price target on the stock from $82 to $59 per share. It was the second downgrade of the stock in two days -- MoffettNathanson media analyst Michael Nathanson issued a “sell” rating on the stock on March 25. ViacomCBS shares have fallen a collective 53% since March 23. 

Discovery stock was down as much as 38.5% to $35.54 (down $22.21 each) in early trading Friday, after some reports speculated that one of the company’s insiders was potentially contemplating a big sale of shares. 

Discovery shares have wavered over the past few days as well, dropping 13% on March 23 and another 7% on March 25. 

The pressure on the stock was high enough Friday that it forced Discovery to issue a statement refuting the speculation.  

In a statement, Discovery said that “today's trading activity is not the result of insider transactions or transactions by Advance/Newhouse Programming Partnership or its affiliates. The company issued its outlook for the first quarter of 2021 on February 22, 2021 and provided additional guidance at the Deutsche Bank TMT Conference on March 8, 2021, and is comfortable reaffirming its outlook and the additional guidance. 

"The Company is confident in and pleased with the execution of its strategy, both with respect to its traditional business and the direct to consumer roll out," Discovery said. "It looks forward to releasing first-quarter results and hosting its quarterly investor call on May 10, 2021."

In his report, Cahall wrote that he believes the momentum that had driven ViacomCBS and other streaming programmers like Discovery and AMC Networks to record highs in the past few months has shifted. 

“Now times are changing and we're changing with the times,” Cahall wrote. And though he doesn’t those stocks will retreat to their historic lows, “we do see gravity pulling the multiples closer to prior norms. As such, we're taking price targets and multiples down along with downgrades.”

Shares of World Wrestling Entertainment fell more than 10% in afternoon trading Friday after the scripted sports giant reported disappointing Q4 results, stoking fears that higher expenses could eat up the benefits of its recent NBCUniversal deal in its first year.

WWE, like every other entertainment company, has been negatively affected by the pandemic. But the wrestling giant has been hit particularly hard as stay-at-home orders basically erased its live event revenue, which fell 97% in Q4 to $700,000 from $27.4 million in the prior year. Overall revenue dropped 26% to $232.2 million in Q4 and Operating Income Before Depreciation and Amortization (OIBDA, a measure of cash flow) fell 52% to $51.2 million. For the full year, revenue rose 1% to $974.2 million, primarily because of increased content licensing fees, and OIBDA increased 59% to $286.2 million, also due to higher licensing fees. 

On a conference call with analysts to discuss Q4 results, WWE chairman and CEO Vince McMahon said he expected a gradual turn to live events and was excited about the NBCU deal. As part of that transaction, subscribers to Peacock’s ad-supported tier can get WWE Network for $4.99 per month, half the $9.99 per month WWE charged.  

“This agreement is really awesome for our WWE fans,” McMahon said of the NBCU deal, adding it gives them greater value. 

But despite that optimism, some analysts feared that management comments on increased expenses and the confusing nature of the NBCU agreement would pressure shares. 

They were right.

 WWE held the analysts’ call at 5 p.m. on Feb. 4 and the next day, the stock was immediately impacted, opening at $53 per share, $3 per share below its previous day’s close of $56. By the afternoon the fall had become more pronounced as shares sank as low as $48.87 each (down 12.7%, or $7.13 each), before closing at $49.22 per share, down 12.1% or $6.78 each, on Feb. 5. 

In a research note, Evercore ISI analyst John Belton wrote that he was encouraged around solid guidance for 2021 and expectations for 2022, but expected investors to react poorly to some management comments around expenses and the NBCU deal.

“With the impact of COVID on WWE’s business better understood and with a guidance range for 2021 adjusted OIBDA established, focus has shifted to the business’s longer term earnings power now that a long-awaited licensing deal for the WWE Network has been reached with Peacock,” Belton wrote. “Unfortunately, we think investors will come out of the 4Q earnings cycle a bit disappointed by some of management’s comments around both higher than expected expense growth expectations beyond this year and the confusing nature of the Peacock agreement, and we are reducing our 2022E adjusted OIBDA forecast by ~4% to reflect this sentiment.”

WWE unveiled the NBCU deal in late January. According to that transaction, NBCU’s Peacock service would get exclusive streaming rights for WWE Network in the U.S. NBCU also would continue to air WWE’s Monday Night Raw on its USA Network. 

WWE had launched the WWE Network in 2014 and had enjoyed some early success. But the streaming service peaked at 2.1 million subscribers in 2018 and by Q4 2019 that number had dropped to 1.5 million. Investors and analysts feared that WWE would throw in the towel on streaming, but Vince McMahon had continued to stress that a big deal was on the way. During a conference call with analysts in February 2020 to discuss Q4 2019 results, McMahon continuously interjected that “the majors” are “clamoring” for WWE content. If the company did decide to do a licensing deal, he said, it could announce it before the end of next month.

“We’d be announcing that deal, if we go that way, in the first quarter,” McMahon said at the time. “That’s how far along we are.”

The pandemic, which began to take hold in March of that year, no doubt put a damper on any deal being finalized. But with the new Peacock deal, there are still questions as to what impact it will have on the overall operations.  

On the Feb. 4 earnings conference call, WWE chief financial officer Kristina Salen said that the first year would be the biggest in terms of revenue from the NBCU deal, because of the valuation for the subscribers and IP that will transfer over to Peacock.

“That will be all recognized in 2021, and then in 2022, you'll have the regular revenue recognition of the ongoing deal,” Salen said on the call. 

She added that WWE expects a “significant” increase in expenses due to higher production costs associated with its ThunderDome virtual video conferencing crowd system for live events and the return of workers from furlough. Despite those increases, Salen said OIBDA is expected to be between $270 million and $305 million in 2021, due to the Peacock deal, more live events and the escalation of core content rights. 

With OIBDA expected to be at best 7% higher or at worst 6% lower in 2021 than in 2020, most analysts saw that as an indication that increased costs would eat up most of the Peacock gains, at least in the first year. 

Belton estimated that about 25% of the revenue in the five-year deal will be realized in year one, adding in his note that under those assumptions, WWE could expect a $30 million OIBDA tailwind in the first year, of which about $15 million potentially reverses in 2022. “From there we believe the agreement will more closely resemble a typical rights deal with contractual annual fee escalators,” he wrote.

Barclays Research media analyst David Joyce, was a little more optimistic, adding that investors likely have “written off” this year, but that the Peacock deal and live events expected to pick up in the second half of the year could bolster the outlook for 2022.

Joyce added that although the Peacock deal reduces optionality for the WWE Network, Comcast NBCU’s stronger balance sheet and distribution strength could open other doors globally. 

“This backstop could also help WWE invest in more of a longer-term fashion in making content better at WWE, something that has been a source of operational volatility,” Joyce wrote.  

In a Jan. 29 research note, Wells Fargo Securities media analyst Steven Cahall wrote that operating expenses will be the key. If 2021 opex is more skewed toward personnel, marketing and content, then 2022 OIBDA could reach $350 million. That estimate rises to around $400 million if 2021 opex guidance is conservative and has a lot of one-time charges.

Cahall added that he's bullish on the stock if it can reach the high end of his 2022 OIBDA forecast. But he cautioned that WWE wasn’t “quite out of the woods.” He pointed out that reaching that level would mean WWE would have to spend more to squeeze higher ratings out of an already corded entertainment field, and noted that in the past, WWE has underperformed investor OIBDA expectations. 

“We think WWE gets the double-whammy up and down: higher multiple when OIBDA estimates move up, lower multiple when estimates come down,” Cahall wrote. “So, where opex goes, likely so goes the stock.” 

Comcast shares rose by more than 7% in early trading Thursday after reporting record fourth quarter broadband subscriber growth, news that drove other stocks in the sector up and fueling optimism that similar results could be in store for other cable operators.

Comcast shares rose as high as $52.20 each (up 7.8%) on Jan. 28 after it reported it had added 538,000 broadband customers in Q4 and more than 2 million additions for the full year. While Comcast warned investors that 2020 growth, fueled mainly by the pandemic, shouldn’t be expected this year -- the company said they should expect performance similar to its 2019 gains -- that didn’t dampen enthusiasm for the shares. 

Comcast’s good fortune also bodes well for other cable operators that haven’t released Q4 results yet. Charter Communications, scheduled to release its Q4 results tomorrow morning (Jan. 29), saw its shares rise nearly 9% ($54.96 per share) on Jan. 28, while Altice USA (scheduled to release year-end results on Feb. 10) rose 8.2% ($2.81 each) to $36.99 per share. Cable One, the top performing cable stock in 2020, saw its shares rise as much as 8.1% ($155.07/ Jan. 28 to $2,069.14 each.   

The stocks continued that momentum later in the day, with Charter up 8% ($49.48) to $665.26 each; Comcast up 7.7% ($3.73) to $52.15; Altice USA up 7.6% ($2.59) to $36.77 and Cable One up 7.6% ($145.93) to $2,060 each. 

Analysts are expecting Charter to add about 350,000 broadband customers in Q4, below its record-setting Q2 growth of 850,000 additions, but still ahead of the 2019 mark of 313,000 residential gains. Altice USA is expected to report  broadband gains of about 15,000 subscribers, pushing its overall yearly gain to more than 200,000. 

World Wrestling Entertainment shares continued their slide Monday, even as speculation swirled that online retail giant Amazon could be a potential partner.

WWE has been in a tailspin since Jan. 30, when the company said it had terminated its co-presidents George Barrios and Michelle Wilson. The fall off continued after WWE said last week that it was evaluating strategic alternatives for its streaming video service, WWE Network.

WWE shares closed Monday at $41.99 each, down 54 cents or about 1.3%. The stock, which traded as low as $40.88 (down 4%) on Feb. 10, has fallen about 33% since Jan. 30. 

WWE chairman and CEO Vince McMahon told analysts Feb. 6 that among WWE’s options is licensing its content to a “major” network or streaming service. While McMahon did not reveal who the company could partner with, he said if that route were taken, a deal could be reached as soon as next month. 

“That’s how far along we are,” McMahon said last week.

That touched off a whirlwind of speculation as to who that partner could be, with Needham and Co. analyst Laura Martin telling CNBC that Amazon could be a possible buyer of WWE content.

Martin had no knowledge of any talks between the two but said Amazon, which has shown interest in sports in the past -- it has purchased streaming rights to Thursday Night Football and is a minority partner in the YES Network RSN -- could find WWE content attractive. She added that a rights purchase could lead to an eventual buyout of the entire company.

“We believe that such a licensing deal would put Amazon in the best spot to purchase all of WWE, whenever the family is ready to exit,” Martin said, according to CNBC. “Vince McMahon is currently 74 years old, going on 50.”

Another possibility, offered FBN Securities analyst Robert Routh in an interview, could be NBCUniversal’s Peacock streaming service.

Peacock, set to launch on April 15, could use all the content it could get. And its parent, NBCUniversal already has a relationship with WWE -- its USA Network airs WWE Raw on Monday nights.

“They [WWE] are being very tight lipped in terms of what their options are, but they have been clear that they have a bunch of them,” Routh said.

Altice USA stock, one of the top performers in the cable sector this year, fell more than 20% on Wednesday, the first trading day after the cable operator said it would report negative broadband subscriber growth in Q4.

Altice USA shares were priced as low as $24.56 per share in early trading Wednesday, down 22% or $6.57 per share. The stock was priced at $25.03 each as of 10:42 a.m. on Nov. 6, down $6.32or 20.1% each.

The stock fell hard after Altice USA reported flat earnings on Tuesday night, but analysts were most concerned about guidance for the fourth quarter, where the company predicted that broadband customer additions would be negative.

Revenue at Altice USA was essentially flat for the quarter at $2.4 billion. The company also reduced its year end revenue growth guidance to about 2.5% from the previous target of 3% to 3.5%.

In a research note, Barclay’s media analyst Kannan Venkateshwar said although the lower broadband guidance appears to be the result of promotional rolloffs, “it is not clear why this came as a surprise to [Altice USA] and wasn't part of its guidance. This raises obvious questions around operational visibility and growth quality which could temper expectations for 2020.

Altice USA CEO Dexter Goei said on a conference call with analysts Tuesday that the company’s sluggish Q3 financial results were due to expiring promotional offers, the absence of expected political ad revenue and a billing system change in its Suddenlink Communications systems that impacted gross subscriber additions.

“It just happens to be that we're hitting a vortex of a lot of the promos rolling off in the second half of this year,” Goei said on the call. “We saw some coming in Q3 but we're seeing an acceleration just in Q4.”

Related: Altice’s Model Behavior 

He noted that Altice USA added about 7,000 broadband customers in Q4 2018. And he expects the company to get back on track toward broadband subscriber growth quickly.

“It's a significant percentage increase relative to last year,” Goei said of the expected Q4 decline. “But going into 2020 we're going back to a normalized level that we saw in 2018. So this is really a one time effect that we expect to see.”

Broadband growth has been one of the bright spots in the cable business and its continued growth has helped investors forget years of mounting video customer losses and cord-cutting. So any hiccups in the broadband growth story are likely to lead to skittish investors and a volatile stock price.

Evercore ISI media analyst James Ratcliffe added in a report that while the lower broadband guidance was expected to impact shares in the short-term, his long-term view of the company remains intact.

“Altice USA’s mixed 3Q19 results and lowered guidance for the remainder of the year (including negative broadband subs in 4Q19) likely to bring back some degree of investor uncertainty, but they don’t change our fundamental expectation that modest topline growth, incremental EBITDA margin expansion, and ongoing capital returns will drive robust Free Cash Flow/share growth going forward,” Ratcliffe wrote in a note to clients. “We’re trimming our 4Q19 topline and subscriber estimates, and slightly reducing our 2020E forecasts, but our overall forecasts are largely unchanged.”

Altice has been one of the top performers in the sector -- its shares were up about 90% for the year prior to Nov. 6 -- and the company seemed poised for stronger growth as it launched an aggressively priced wireless offering and a “price-for-life” campaign aimed at attracting retaining video and data customers. 

Netflix stock, already staggering after missing domestic subscriber growth estimates in Q3, fell 4% Tuesday after Verizon said it would offer a free year of rival streaming service Disney+ to its customers once it launches next month.

Netflix shares closed Tuesday at $266.69 per share, down 4% or $11.36 each. The stock was down 6% on Oct. 18, after reporting that it added 517,000 domestic new subscribers in Q3, shy of the 800,000 additional customers it had predicted.

Verizon said Tuesday it would give its wireless customers with unlimited data plans free access to Disney + for 12 months. Its Fios home internet customers also would receive the Disney + service for one year at no charge. Disney + is scheduled to launch Nov. 12 at a $6.99 monthly price point and will offer content from Disney, Marvel, Pixar, Star Wars and National Geographic.

Netflix investors have been skittish about the competitive threat from Disney + and other upcoming streaming offerings from Apple (Apple TV +) and AT&T (AT&T TV). Last week during its earnings call chairman and CEO Reed Hastings said he wasn’t worried about the added competition. 

Sprint stock soared more than 27% ($1.72 each) in early trading Monday after the country’s top federal regulator said its pending merger with T-Mobile should win approval.

Sprint stock was priced as high as $7.90 per share on Monday, up $1.72 each or 27.8% in early morning trading. The stock managed to maintain much of that momentum as the day progressed -- it was priced at $7.17 each, up 99 cents each or 16%, at 3:01 p.m. on May 20 -- but lost some of the ground by the end of the day, closing at $6.95 each, up 77 cents or 12.5% per share.

T-Mobile stock, up as much as 7.4% earlier in the day, closed at $78.29 per share on May 20, up $2.92 each, or about 4%.

T-Mobile and Sprint first announced their $26 billion merger in April 2018. 

Related: FCC's Carr Will Vote to Approve T-Mobile/Sprint 

On CNBC’s “Squawk Alley” Monday, FCC commissioner Brendan Carr also threw his support in favor of the deal. 

Carr told CNBC that in a filing with the commission this morning, T-Mobile walked through its plans for the merger.

“I think one thing that stood out from that filing is we’re going to see 97% of the country covered with 5G within three years,” Carr told CNBC. “When you think about U.S. leadership in 5G, one of our big goals is make sure every single community can benefit, not just the biggest cities. And this combination through that enforceable mechanism that’s in that detailed filing is going to put us on that path.”

AT&T shares fell by more than 4% in early trading Wednesday, after the telecom giant reported mixed Q1 earnings, as subscriber losses continued to plague its media business.

AT&T shares fell as low as $30.71 per share in early trading April 24, down 4.3% or $1.39 each. The stock closed at $30.79 each on Wednesday, down 4.1%.

The telco reported mixed Q1 results on Wednesday morning --overall revenue was up nearly 18% to $44.8 billion, but subscriber losses at its Entertainment Group continued to rise -- it lost 544,000 premium TV customers and shed 83,000 subscribers at its DirecTV Now streaming video unit. The company did offer some insight into its upcoming streaming service, slated for a Q4 release, and said it would hold a WarnerMedia Analysts Day in September or October.

In a research note MoffettNathanson principal and senior analyst Craig Moffett said the premium TV loss -- a combination of DirecTV and Uverse subscribers -- were far worse than consensus expectations of a loss of about 385,000 customers. The DirecTVNow decline was inline with consensus estimates of a loss of 82,000 subscribers.

The DirecTV Now losses build on a decline of 267,000 subscribers at the over-the-top service in Q4. That service, once one of the fastest growing in the streaming space -- it now has about 1.5 million customers, down from around 1.8 million in Q3 -- has lost 17% of its customers in a six-month period.

“For a while, AT&T pointed to their DirecTV Now OTT service as the way out of the DirecTV tar pit,” Moffett wrote. “In the months since a price increase in July, however, the growth of their DirecTV Now subscribers first slowed, and then collapsed.”

Charter Communications stock rose as much as 14.6% in early trading Thursday, after the company reported strong Q4 financial results and said it expected capital expenditures to fall by $2 billion this year.

Charter stock rose as high as $332.24 per share (up 14.6% or $42.33 per share) in early trading Jan. 31. The stock was priced at $330.07 (up 13.9% or $40.16 per share) at 10:11 a.m. on Thursday.

The stock, which was down about 15% in 2018, is quickly erasing that deficit with today’s early gains. At it's high point earlier today, Charter shares were up 16.6% for 2019.

Charter said that its all-digital and DOCSIS 3.1 build-outs have been completed, which should dramatically reduce capital expenditures for this year and for the foreseeable future. Capital expenditures should be about $7 billion in 2019, $2 billion less than the $9.1 billion it spent in 2018. At the same time, the cable operator expects subscriber metrics to improve, noting that churn characteristics in the former Time Warner Cable and Bright House Networks systems it acquired in 2015 are getting better.

In a research note, MoffettNathanson principal and senior analyst Craig Moffett wrote that uncertainty around capital expenditures -- investors knew it would go down but not by how much -- and the company’s reticence to give guidance has hurt the stock in the past. But now, with such a dramatic fall in capex -- most models didn’t see it reaching $7 billion for at least three years -- and strong financial and operating results, the veil around Charter has been lifted.

“Charter can legitimately be seen as a growth story again,” MoffettNathanson principal and senior analyst Craig Moffett wrote.

On a conference call with analysts to discuss Q4 results, Charter chairman and CEO Tom Rutledge said the capex reduction is expected to be more than just a one-off development.

"We do think that in general, going forward that beyond 2019 and beyond our guidance that capital intensity will come down," Rutledge said. "That's a function of revenue growth and continued opportunities to be more efficient with our capital spending. But it really depends on how fast you're growing, and how fast the opportunities to become more efficient are in terms of your customer service infrastructure."

Charter is rolling out its Worldbox platform “on the increment” across its footprint, Rutledge said, which offers a dramatically improved user interface and should help make Charter video product stickier and more compelling. Rutledge added that Charter’s video strategy is to embrace new technology as well as well as more traditional tenets.

“We embrace where the marketplace is going,” Rutledge said on the conference call. “We want people to use video services on our network. We think there are ways for us to be in the connected video business in a way that provides incremental margins for us, at the same time using the video business to drive our core business which is connectivity.”

He added that while bundled services still make up the bulk of the video side of the business, Charter is willing and able to accommodate consumers that bring their own CPE devices to the equation.

“The mix of direct-to-consumer and the mix of direct-to-consumer hardware -- bring your own device -- in the video space will change over time and we are going to allow it to change as the market dictates and try to make our products work best on every device we provide,” Rutledge continued. “There is still significant opportunities for us to provide CPE devices to consumers, bringing all their services together in one consistent way. That said, there are consumers that definitely want CPE and there may be CPE vendors creating great CPE. We’re open to being a supermarket of video services, however those services develop. We think we can run our traditional models and new models simultaneously. When we look at video usage on our network, it is actually going up.”

Good riddance, 2018.

Cable stocks, coming off a 2017 that saw double-digit increases for the distribution sector, gave most of it back in 2018, thanks to a late market meltdown and fears that the effects of streaming video on traditional distribution and content creation could be even worse than anyone expected.

On paper, the declines don’t look that bad. Distribution stocks were actually up slightly for the year (0.6%) and programming stocks, up 4.1% in 2017 after a flurry of late-year deals, were down just 1% for 2018. But looks can be deceiving.

The slight uptick among distributors was due entirely to one stock, broadband-centric cable operator Cable One. Its 16.6% jump for the year — the only distribution stock to show a gain — effectively erased everyone else’s losses. Take Cable One out of the equation and the sector fell 21% for the year.

Distributor Disaster

It didn’t seem to matter what other distributors did, their shares were pounded. Comcast and Charter Communications, the two largest U.S. cable operators with 22 million and 16 million video customers, respectively, were down 15% each for the year even after launching successful wireless product offerings. Altice USA, in the middle of an ambitious fiber upgrade, debuted its whole-home gateway — Altice One — and its stock still fell 22%.

Dish Network, which saw its traditional satellite business continue to erode while its virtual MVPD offering Sling TV grew, albeit more modestly, fell hardest, down 48% for the year. AT&T, which wrapped up its purchase of Time Warner — the Justice Department has appealed to try to block the deal — was down 26.6% for the year.

It wasn’t much better for programmers. Down 1% for the year, three sector stocks ended the year in positive territory: The Walt Disney Co. (up 2%), 21st Century Fox (up 39%) and Discovery Inc. (up 10.5%). But Disney and Fox rose primarily because of the $71.3 billion deal by the former to buy programming assets of the latter.

Other stocks were pounded as investors weighed a declining ad market and uncertainty around direct-to-consumer distribution plans against expected gains in retransmission consent and licensing revenue.

The malaise wasn’t centered on just a few industries. Economic uncertainty that helped drive investors toward the exits had the market as a whole feeling the pain. When the dust settled on 2018, the Dow Jones Industrial Average was down 5.6% for the year, while the S&P 500 Index fell 6.2% and the NASDAQ Composite dipped 3.9%, the worst showing for all three indexes since 2008.

In a research note, Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said while he expects video subscriber losses to continue, he sees opportunity in the sector.

Cable stocks, in his view, are undervalued and the potential threats from 5G are overblown. He also expects operators to materially accelerate buyback programs in 2019, which should provide a “strong wind at the back of the stocks.”

FAANGs Get Whipsawed

For the FAANG stocks (Facebook, Apple, Amazon, Netflix and Google) it was a wild ride until December. Netflix and Amazon were both was on a pace to rise 51% through Dec. 3, Apple was on track for a 9% rise and Google was headed for a 5.7% gain. Facebook, battered all year over privacy issues, was down 20% through Dec. 3. But fears over growing U.S.-China trade tensions and the threat of an interest rate increase that would further slow the economy ground that rise to a halt. By the end of the year, Netflix was up 40% and Amazon up 28%, while Apple (-6.8%), Facebook (-25.7%) and Google (-1%) all lost ground.

On the programming side, CBS stock fell 26.6% for the year, rocked by a sexual harassment scandal that resulted in the ouster of chairman and CEO Les Moonves and other top executives that only exacerbated an aging viewer demographic and uncertainty around a possible reunion with former corporate sister Viacom. Viacom only fared slightly better, dipping 16.6% for the year, as kids’ TV viewership continued to erode and the ad market showed further declines.

Morgan Stanley media analyst Ben Swinburne estimates that total ad revenue should rise 7.6% in 2018 and predicted a 4.4% increase for 2019. For TV, Swinburne predicted national advertising revenue will fall 1.7% in 2019 (compared to a 1.6% gain in 2018) and local ad sales will dip 5.7% in 2019, wiping out the 5.7% rise from the prior year.

Sanford Bernstein media analyst Todd Juenger was even less optimistic about programming stocks, adding that gains in 2018 were based not on fundamentals. This year, he expects Disney and Fox, which have fundamentally changed their businesses to focus on direct-to-consumer and live sports and news, respectively, to fare best. Pure-play cable programmers like Viacom, Discovery and AMC Networks will have a tougher time, mainly because they derive the bulk of their revenue from the old linear TV bundle.

“Once again, the controversy is not whether that system is in decline,” Juenger said. “The controversy is what is the slope of that decline, how much cash will be generated on the way down, and how does that compare to how the companies/stocks are valued.”

The Dow Jones Industrial Average fell more than 500 points on Tuesday, erasing all of the index’s 2018 gains and dragging some cable stocks into the cellar.

The Dow closed at 24465.64 on Nov. 20, down 552 points and eliminating any gains in the index for the year. The falloff originally affected tech stocks like Apple, Google and Amazon, but quickly spread throughout several sectors  including financial services, oil-and-gas and retail. For some tech shares, the big drop was short-lived while for others it was a steady decline. For example, Amazon, down 6% in early trading, finished the day down 1.1%, while Apple, amid concerns over slow IPhone sales, fell as much as 5.6% in early trading and closed down nearly 5%.

For the cable sector, the declines ran the gamut. Charter fell the hardest among cable operators, closing at $305.01, down 5.7% or $18.54 each. Altice USA was next, down 4.6%, followed by Liberty Global (down 4.4%); Cable One (down 4.1%); and Comcast (down 3.7%). On the satellite side, Dish Network was down 4.7% to $30.03 per share, while DirecTV and Turner Networks parent AT&T fell 3.1% to $29.41 per share.

Programming stocks were mixed, with The Walt Disney Co., closing at $111.87 each, down 3.1% and Viacom down 1.9%. Rounding out the sector, CBS finished the day at $52.88 each, down 3.8%; Discovery was down 3.2%; AMC Networks fell 2.5%; 21st Century Fox dropped 1%.

Tech stocks pared their losses as the day wound down, with Amazon down 1.1%, Netflix down 1.3%, and Apple down 4.8%. On the brighter side, Facebook and Google each finished the day up about 1% each. 

Charter Communications shares fell nearly 10% on Friday despite reporting better than expected Q3 results and amid an overall market sell-off that forced the Dow Jones Industrial Average down more than 400 points in early trading.

Charter shares fell as much as 9.7% ($30.44 each) to $284.37 in early trading Friday. The stock was trading at $291.12 per share, down 7.5% ($23.69 each) by 10:55 a.m. on Oct. 26. At that same time, the Dow was down about 445 points.

The company had reported better than expected Q3 customer results before the market opened, but a miss on cash flow growth – up 3.5% instead of consensus estimates of a 5% rise and a slight miss on revenue, $10.9 billion versus consensus of 10.96 billion – apparently was enough to trigger a sell-off.

In a research note before the market opened, Evercore ISI media analyst Vijay Jayant said he expected Charter to trade flat to down on Friday despite the steady Q3 results, mainly because of comparisons to Comcast, which reported record Q3 high-speed data customer growth Thursday.

The rest of the cable distribution sector was fairly unscathed in the Dow’s descent early Friday – most cable stocks were down between 1% and 2% in early trading. Altice USA, which has yet to report Q3 earnings, was down about 5.8% (96 cents) to $15.42 each at 10:55 a.m. Oct. 26, perhaps in anticipation of further bad news for cable distributors.

Disappointing tech stock earnings triggered the Dow plunge, as Amazon and Google each reported lower than expected sales numbers. Amazon shares were down as much as 10% early in the trading session and Google fell as much as 5.4% in early trading

Charter said in a conference call with analysts that it is winding down its integration of Time Warner Cable and Bright House Networks, which it purchased in 2016, and should be finished by the end of the year.

That integration, which included converting much of the TWC and Bright House legacy footprint to digital, buying additional set-top boxes and stepping up broadband speeds, required additional capital expenditures and disrupted the overall operations, chairman and CEO Tom Rutledge told analysts Friday. But those pressures will be substantially eased as the integration is completed.

“We spent a lot of money to upgrade the network to all-digital,” Rutledge said.

Rutledge said TWC’s analog plant had three negative attributes: it ate up spectrum that could otherwise be used for broadband and IP video, it had an inferior picture, and it required deploying new set-tops to every home to fix it.

“That capital to buy the set-top boxes, to roll the trucks and the disruption in the operating business and the impact that has on phone traffic and service calls and therefore the ability to focus on sales, all of that impacted both 2017 and 2018,” Rutledge said.

At the same time, Rutledge was optimistic that recent weakness in the satellite and virtual MVPD sector, could translated into stronger numbers for cable going forward. AT&T said its DirecTV satellite TV service lost about 359,000 net new subscribers in Q3 and its OTT service DirecTV Now added a disappointing 49,000 customers.

“I’ve said all along that I thought the shrinking of the satellite business would benefit our video business, but then you’ve got these other trends as well, including recent price increases in the virtual MVPD space, which probably impacted their results too,” Rutledge said. “…Satellite is a very high-priced single product, with $100 ARPUs in a world where the content is devalued. I think you’ll see continued erosion of that business, and some of that will shift to us.” 

The Dow Jones Industrial Average closed Tuesday up nearly 550 points, beginning what the market hopes is a long crawl back from big losses last week.

The Dow lost nearly 1,400 points between Oct. 10 and Oct. 11 as investors bailed out of the market fearing a slowdown in the economy and increasing trade tensions. Losses continued in subsequent trading but at a slower pace on Oct, 12 (down about 67 points) and Oct. 15 (down 81 points).

The Dow finished Oct. 16 at 25,798.42, up 547.87 points, or about 2.17%, its biggest one-day percentage rise since March.

Cable stocks reaped some benefits, with stocks in the sector rising between 1% and 3%.

Comcast was the biggest gainer on the distribution side, up 2.5% to $35.96 per share on Oct. 16. Charter Communications followed, up 2.2% to $320.86 per share, and Liberty Global rose 1.5% to $26.34.

On the programming side, Viacom was the big winner, rising 3.3% to $32.83 per share, while The Walt Disney Co. rose 2.6% to $116.34; 21st Century Fox was up 1% to $45.86 each and Discovery rose 2.2% to $33.05 each.

AT&T was essentially flat at $32.38 per share as was Verizon at $53.73 per share. Dish Network increased 1.4% to $34.15 per share.

Technology stocks, battered during last week’s sell-off, continued their climb back. Netflix, slated to release its Q3 earnings after the close, rose 4% to $346.59 per share; Amazon up 3.4% to $1,819.95 and Apple up 2.2% to $222.13 each. Facebook finished the day up 3.4% to $158.37 and Google closed at $1,120.02 per share, up 2.5%. 

Comcast executives celebrating their weekend victory over 21st Century Fox for British satellite giant Sky plc woke Monday to a harsh reality as investors pounded the cable operator's stock, driving shares down more than 8% in early trading.

Comcast investors made no bones about their displeasure in Comcast 's pursuit of Sky -- the stock has been down about 4% since Comcast first made its European satellite intentions known in February. So when the company emerged as the victor on Saturday Sept. 22 with a bid valued at nearly $40 billion (nearly 30% higher than what it had originally proposed) they didn't feel any better.

Comcast shares fell as much as 7.3% Monday Sept. 24 to $35.37 from $37.90 per share, down $2.53 each. The shares improved slightly in later trading -- they were down 8.2% ($3.11 each) to $34.79 at 10:12 a.m.

Comcast beat Fox by more than 1.50 per share in its bid for Sky, according to reports. Comcast won the months-long battle with a bid of £17.28 per share, besting Fox's latest offer of about £15.67 per share, according to reports. With the win, Comcast now must decide whether it plans to purchase the 39% interest in the satellite company still held by Fox -- some analysts believe it could swap its 30% interest in Hulu for that stake -- or continue to have a substantial minority shareholder in the U.K satellite business. 

In a research report Monday, MoffettNathanson principal and senior analyst Craig Moffett, a critic of Comcast's pursuit of Sky in the past, didn't change his mind with the win. In his report, Moffett called the deal a "winner's curse," in that it was good for Disney, which will end up with Fox's 39% Sky stake after it completes its $71.3 billion purchase of certain Fox assets, and bad for Comcast.

The deal is good for Disney in that it didn't have to pay an inflated price for an asset in an industry in decline -- the satellite TV business -- and that it could use its Sky stake to further increase its interest in a growing market -- online video -- through Comcast's 30% interest in Hulu.

Moffett believes the deal is bad for Comcast because it fails to solve its biggest challenge -- the rapid shift of audience away from traditional distribution to virtual MVPDs.

"For Comcast, we fear that Sky will be an albatross," Moffett wrote. "Comcast would like to have investors view Sky as a platform-agnostic collection of proprietary programming agreements that can serve as a springboard to create a global OTT provider, and to be fair, the company does indeed have many proprietary programming agreements. But it seems as though they would like investors to forget that it is also a satellite TV provider, and satellite video distribution is increasingly becoming obsolete."

The question of Fox's 39% also looms. While some analysts believe a Hulu swap makes sense -- Disney will own 60% of the online video pioneer after its Fox deal closes -- some believe that handing over full control to a service that already has 20 million customers isn't in Comcast's best interests.

In a blog post, BTIG media analyst Richard Greenfield said he would be shocked if Comcast traded its 30% Hulu stake for Fox's Sky interest.

In his blog post, Greenfield said Disney could collapse Hulu into its own direct-to-consumer offerings if it had full control, rebrand the service and launch it worldwide, which would not be beneficial to Sky's own European DTC platform.

"[W]e suspect Comcast is highly likely to stay invested in Hulu and to prevent it from becoming a Disney-branded DTC platform," Greenfield wrote. "By remaining invested in Hulu, Comcast ensures that Disney is forced to pursue a two-path solution for direct-to-consumer with Hulu and Disneyflix separate – clearly sub-optimal. With only 30% ownership of Hulu, Comcast can frustrate Disney and continue to benefit from Hulu buying Comcast/NBC content and licensing NBC live channels (boosting revenues), while Hulu losses show up as a minority interest below the line (vs. being consolidated at Disney)."

Dish stock fell nearly 4% Monday after MoffettNathanson principal and senior analyst Craig Moffett downgraded the shares to “sell,” adding in a note to clients that despite some recent signs of improvement, the only positive path for the satellite giant would be a sale of its wireless spectrum.

Dish stock was as low as $33.88 per share in early trading Aug. 13 (down $1.29 each or 3.7%) but rallied later to trade at $34.61 each, down 56 cents per share or 1.6%. The stock closed Aug. 13 at $35 each, down 17 cents or 0.5% per share.

Moffett, who also reduced his 12-month price target on the stock to $29 per share, placed a “sell” rating on the stock since June 2016, upgrading shares to “neutral” in March  of this year, after it appeared the stock had bottomed out after a series of declines.

Dish shares were down 30% in the first six months of this year, but gained some ground earlier this month after the company showed some improved subscriber metrics in Q2– its satellite net customer losses were less than the prior year and churn improved. That resulted in an almost 23% rise in the Dish’s share price between Aug. 2 and Aug.9.

Moffett acknowledged that Dish’s Q2 results were “genuinely better,” but added it may be short-lived.

Dish, Moffett noted, is “bewilderingly complex,” adding that while the company is moving ahead with plans to build out its wireless spectrum, there are a dizzying number of scenarios that could play out, including several different ways to build out the network, selling spectrum at high and low prices and potential regulatory wins and losses tied to that buildout.

“We further observed that all that complexity can be boiled down to one simple proposition: a spectrum sale (and at a price above which is already implied in Dish’s stock price) is the ONLY positive scenario for the stock,” Moffett wrote. “EVERY other scenario, including every variation on a network buildout, is a negative. Unfortunately, those ‘other’ scenarios have only gotten more likely.” 

TiVo shares fell more than 4% on Thursday after CEO Enrique Rodriguez abruptly left the DVR pioneer to become chief technology officer of Liberty Global. 

TiVo board member Raghu Rau has stepped in as interim CEO as the company searches for a permanent replacement.

Related: Liberty Global Names Former TiVo Chief New CTO 

TiVo has been transitioning from an equipment manufacturer to focusing on software, services, advertising and licensing. Rodriguez joined TiVo in November after serving stints at AT&T, Microsoft and Cisco, and was supposed to lead that charge. 

TiVo shares dipped as low as $13.20 each in early trading (down 65 cents each or 4.7%). The stock closed at $13.30 each (down 55 cents, or 4%) on Thursday. 

Related: Tivo Has 'Moved Well Beyond a Hardware Company' CEO Says

In a statement, TiVo said Rodriguez’ decision to leave was a personal one.

“On behalf of the Board, I want to thank Enrique for his leadership and we wish him the best in his next chapter,” TiVo chairman James Meyer said in a statement. “We are fortunate to have a world-class leadership team in place and are pleased to have someone of Raghu’s caliber step in to lead the Company. He has been a member of the TiVo Board of Directors since 2015 and is a proven leader with extensive experience in the video industry and in the management of intellectual property. I am confident that Raghu, alongside the rest of the leadership team, will continue to drive the value that TiVo’s innovative technology portfolio brings to the fast-growing and hyper-competitive entertainment industry.”

Related: TiVo 'Exploring All alternatives' to Drive Shareholder Value 

Back in February, TiVo said it was exploring all of its options, including transformative acquisitions, combining with other companies or going private. 

Rodriguez said the decision to leave was a tough one.

“My personal decision to pursue another opportunity was not easy,” Rodriguez said. “I couldn’t be more excited about what lies ahead for TiVo as I expect our performance through the second quarter of 2018, including our announced profit improvement actions, to be ahead of our internal plan. I am looking forward to continue my relationship with TiVo in my new role as a customer and partner. Until then, I am committed to working with the TiVo team to ensure a seamless transition.”

Rau, who served as CEO of SeaChange International from 2011 to 2014, has been a TiVo director since 2015. Prior to his work at SeaChange, Rau held a number of senior leadership positions with Motorola from 1992 to 2008.

As cable stocks have hit new 52-week lows over the past few weeks as investors fear that cord-cutting is accelerating in the pay TV distribution arena, Comcast Cable CEO Dave Watson told an industry audience Monday that its stance towards video hasn’t changed.

Cable stocks have fallen out of favor in the past few months, some say driven by fears that Comcast has lost its faith in the business and is instead turing its attention to international assets – like its March bid for British satellite giant Sky – and rumors that it is also interested in acquiring Fox assets currently pledged to The Walt Disney Co.

At the MoffettNathanson Fifth Annual Media & Communications Summit, Watson said that the only thing that has changed in the past several months is that a scaled media investment – Sky – came up for sale.

“We didn’t anticipate it,” Watson said of the Sky sale. “We have a very good track record in M&A, but by no means does the fact that we look at an opportunity mean we’ve lost confidence in our core business. Cable is a great business.”

Watson added that while Comcast tries to keep customers through a variety of programming and broadband packages, but added that when a customer leaves as a result of price, the impact is actually favorable to the company.

“We segment the marketplace,” Watson said, adding that when a low-end customer drops video service over price, but keeps their broadband service – at a higher monthly charge – the company makes out better.

“It’s actually accretive when that happens,” Watson said. “It’s a manageable transition.”

And while broadband customer growth has slowed down over the years, Watson said there is still runway, particularly with homes that have slower-speed services like DSL.

Watson said about 75% of Comcast’s broadband customers take service at 100 Mbps or higher and he estimated that there are about 4 million DSL customers.

As more and more apps demand higher and higher bandwidth, he added that Comcast is “positioned very well to be competitive.”   

A sell-off in tech stocks drove another day of declines in the Dow Jones Industrial Average Monday, with shares of Amazon and Netflix dipping more than 5% for the day.

The Dow finished down 459 points, or about 1.9%. But other exchanges felt the pain too -- the tech-heavy NASDAQ was down 2.7%, giving back all of its gains for the year, while the S&P 500 declined 2.2% for the day.

The tech sector has been rocked by fears of increased regulatory scrutiny following Facebook’s Cambridge Analytica scandal and President Trump’s twitter storm criticizing Amazon and what he claims is its taking unfair advantage of the U.S. Postal Service. Facebook shares have fallen a collective 16% since March 16, just before stories surfaced that Cambridge Analytics has used personal data from more than 50 million Facebook users without their knowledge.

Facebook shares were down another 2.8% ($4.40 per share) on Monday to $155.39 each. But the bulk of the losses were weathered by Amazon, down 5.2% and Netflix, down 5.1% for the day. Google closed at $1,006.47 each, down $25.32 or 2.5% while Apple was priced at $166.68, down $1.10 per share or less than 1%.

Amazon finished April 2 at $1,371.99 (down 75.35 each) while Netflix was priced at $280.29 (down $15.06 each). According to The Wall Street Journal, FAANG stocks have lost about $324 billion in market cap since March 16.

Cable stocks were down, but it could have been worse. Charter Communications and Cable One fell hardest in the distribution sector, down 2.4% and 2.1%, respectively. Comcast closed at $33.52 per share, down 1.9% (65 cents) while Altice USA finished at $18.29 (down 19 cents or 1% per share) and WOW was down 1.5% (11 cents) to $7.04 per share. On the programming side, AMC Networks was down 2% ($1.04) to $50.66 each followed by The Walt Disney Co., which earlier today said it would launch its ESPN Plus direct to consumer offering on April 12, closing at $98.66 per share, down $1.78 or 1.8% each. Other stocks in the sector had slight gains – Time Warner Inc. closed at $94.80, up 22 cents (0.23%) and Discovery Inc. finished the day at $21.58, up 15 cents each or 0.7%.

Whether Comcast makes a formal offer for British satellite giant Sky or decides to find another means to acquire scale could all come down to the MSO's stock price, MoffettNathanson principal and senior analyst Craig Moffett said in a note to clients Wednesday.

Moffett said it has been about 30 days since Comcast made public its intention to buy Sky for $31 billion – it has yet to make a formal offer for the company – and since then Comcast's stock has fallen about 16.6%. The analyst likened the current situation to Comcast’s 2004 unsolicited bid for The Walt Disney Co., which was withdrawn after about 10 weeks when the MSO's stock plunged as investors made clear their displeasure with the deal.

The current state of Comcast stock could in part be attributed to the Sky bid. Some investors see it as an indication that Comcast has lost faith in the U.S. cable business, and many see the Sky move as a precursor to a bid for the 21st Century Fox assets currently betrothed to Disney.

And then there is the overall erosion of cable fundamentals. Continued video customer declines – Moffett predicted Comcast will lose 309,000 video customers in 2018 (more than double what it lost in 2017) – increased pressure from cord-cutters and over-the-top services and slowing broadband growth have weighed on the entire sector. But Moffett predicts that if the stock price declines continue much longer, Comcast may be forced to walk away.

Clearly there are differences between the Sky and Disney bids. Comcast’s 2004 $59.9 billion bid for Disney was an all-stock offer, and the further Comcast’s stock fell, the more expensive it became for Comcast shareholders. The Sky bid is an all-cash deal, and therefore the stock decline may not matter in the context of the transaction.

To move ahead with the deal, Comcast would have to make a formal offer to U.K. regulators, but isn't required to do so until seven days after Sky wins U.K. government approval for Fox's own bid to acquire the full company (Fox already owns 39%) and holds its own shareholder meeting to vote on the deal. That could take up to two months to complete, but Moffett believes Comcast may make a final decision before then.

“[W]e would argue that Comcast’s sharp selloff could well lead management to reconsider withdrawing from its pursuit of both Fox and Sky, much as they did in 2004,” Moffett wrote. “We ourselves have pointed to resolution of the AT&T-Time Warner case as a potential catalyst for Comcast’s final decision, but the decline in Comcast’s share could trigger a decision even earlier than that.”

Comcast stock was up slightly (27 cents, or 0.8%) to $33.26 in early trading Wednesday.

A general sell-off in the tech sector, combined with some individual company concerns, took much of the bite out of FAANG stocks on Wednesday.

Shares of Facebook, Amazon, Apple, Netflix and Google all declined Wednesday as the ongoing decline in the tech sector continued. Netflix shares continued their slide on Wednesday, down 5% ($14.92 per share) to $285.77 each. The stock closed at $320 per share on March 26.

Fears of increased regulatory oversight have pummeled the sector all week – the S&P 500’s information technology sector, down about 5.8% for the week, fell nearly 1% on Wednesday.

Amazon dipped 4.4% ($65.63 each) to $1,431.42 per share after a report that President Trump is considering adjusting its tax treatment because he is concerned about how the online retailer is decimating mon-and-pop businesses.

Facebook stock caught a break after the Cambridge Analytica scandal, finishing the day Wednesday at $153.03 each, up 81 cents or 0.5%. The stock, however, is still down about 17% from its close on March 16.

Apple stock fell about 1.1% ($1.86 per share) to $166.48 each after Goldman Sachs lowered its estimates for iPhone demand in the March and June quarters.   

Google stock declined slightly for the day – it closed at $1,004.56, down 54 cents or 0.05%.

Influential media analyst Craig Moffett, principal and senior analyst at MoffettNathanson raised his rating on Dish Network to “neutral” from “sell,” adding in a note to clients that the satellite giant’s stock price may be closer than ever to its true value.

Dish stock has been pummeled over the past year – Moffett wrote that it has underperformed the S&P 500 by 50 percentage points over the past 12 months and has registered new 52-week lows almost daily over the past several weeks. But now, with the stock hovering in the mid-to-low $40 per share range since February, Dish may be the closest it’s been in years to its true value.

“The case for an upgrade (to Neutral, that is, not to Buy) is relatively simple,” Moffett wrote. “Dish was badly overvalued. It isn’t anymore.”  

Dish shares were up slightly on March 22 – they were priced at $38.11 each, up 34 cents or 1% in early trading.

Moffett said at its current price range – he has maintained his $37 per share 12-month target on the stock – Dish’s wireless spectrum (its biggest valuation source) is valued at about $1 per MHz POP, which is what Moffett believes it would attract in a sale. Dish has accumulated a wide swath of spectrum over the past few years, and speculation has been that other wireless companies, hungry for more bandwidth, would either by Dish’s wireless licenses or the company itself. When it became apparent in the past year that that was unlikely to happen, Dish stock started to falter. Investors became increasingly skittish when chairman Charlie Ergen made moves to build out that spectrum – it needs to reach 70% of its licensed areas by the end of 2020. 

In his report, Moffett wrote that the spectrum buildout has its own questions – will Dish be able to complete it in time to meet federal deadlines, will it cost more or less than the $1 billion Dish has estimated and will it have to take on a JV partner to complete it? Add in the declining satellite TV business and the picture looks increasingly grim.

Satellite TV has been under pressure for years – DirecTV, purchased by AT&T in 2015 reported its first full year of net subscriber losses in 2017. And chances are those losses would have been sooner if AT&T hadn’t been encouraging U-verse TV users to switch to satellite.

Related: Small Dish, Deep Decline

To his credit, Ergen has been more candid than most CEOs about the decline of the satellite business – he has been saying it is maturing for years – and has tried to address shifting viewing habits with smaller video packages – like Dish's Flex Pack – and its own over-the-top service Sling TV. Sling TV, which was launched in 2015, has about 2.2 million subscribers and is currently the largest subscription OTT service in the U.S. (DirecTV Now is a close second with about 1.5 million customers).

And Ergen is no stranger to gloom and doom predictions – he has weathered them before and managed to dazzle investors with new products or lines of business (RE: The Hopper, Sling TV, wireless spectrum). There is no reason to think he can’t pull a rabbit out of his hat again. But, he'd better hurry.

Charter Communications stock was up more than 7% in early trading Monday as speculation concerning a possible deal with Japanese wireless giant Softbank, rejected just months ago, has been rekindled.

Charter stock was trading as high as $361.28 per share (up 7.7% or $25.85 each) after CNBC reported that Softbank chairman Masayoshi Son was willing to come back to the table with the cable company. Softbank had made overtures to Charter in July, which were rebuffed by the cable operator and its largest individual shareholder Liberty Media. Softbank later turned its attention to moving forward with the T-Mobile merger. Now that those talks are off too, CNBC said Son is willing to restart his Charter efforts.

According to CNBC, Liberty, which owns about 27% of Charter, is interested in a combination, while Charter management is not.

Charter declined to comment.

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak was skeptical about Liberty’s interest in a deal, particularly because Sprint’s equity is so volatile. And he wondered why either would want to rush into a deal.

“I don’t see why Liberty would be interested in taking Sprint/Softbank equity,” Wlodarczak said in an e-mail message. “The US wireless business is going to get uglier and uglier, precipitated partly by the aggressive entrance of cable into wireless utilizing favorable MVNO’s.  A better move – and far more likely – is cable in a couple of years after a competitive implosion in wireless, buying a U.S. wireless operator at a healthy discount to current multiples.”  

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak raised his rating on Dish Network to "buy" Monday, adding that the satellite TV company could be more attractive in the wake of the failed Sprint-T-Mobile merger.

Sprint and T-Mobile officially called it quits Saturday, saying after months of talks about a possible merger that no deal could be reached.  Sprint on Sunday announced an MVNO Agreement with Altice USA, unrelated to the merger action. 

In a note to clients Monday, Wlodarczak wrote that Sprint's loss could be Dish's gain, either through a spectrum sale to another carrier like T-Mobile or Verizon, or an outright sale of the company. Dish has wireless spectrum licenses that are valued at about $10 billion, and minus a Sprint/T-Mobile merger those assets could be rising in value.

Dish stock already was on the rise in early trading Monday, up 6.7% ($3.23 per share) to $51.30 each.

"In our opinion, post the T-Mobile-Sprint deal failure there is a reasonable chance that T-Mobile could make a play for Dish or Dish spectrum as it would immediately vault the most disruptive U.S. wireless player into the leading U.S. spectrum position (w/ substantially more spectrum than underpins Verizon’s “best in class” network)," Wlodarczak wrote. "This possible move could force Verizon to counter-bid for Dish spectrum (or possibly the entire company) as Dish spectrum is ideally suited for Verizon and to keep it out of T-Mobile’s hands."

The analyst pointed to Verizon's bidding war with AT&T over Straight Path earlier this year, which Verizon ultimately won.

"In our view, we don’t see what T-Mobile management has to lose in engaging in talks with Dish about a possible deal (either they get high quality spectrum or force Verizon to overpay)," Wlodarczak wrote. " In addition, AT&T, post their Time Warner deal, could (and frankly should) be interested in purchasing Dish’s core DBS business taking advantage of a potentially more laissez faire regulatory climate/emergence of V-MVPD’s, to significantly bolster their DirecTV business (and help to justify the original questionable DirecTV deal) by creating a SatTV monopoly in ~10-15M US households, increased programming scale and massive synergies at a likely very attractive price."

Credit Suisse media analyst Omar Sheikh initiated coverage of WideOpenWest with an “outperform” rating and a $20 price target Monday, adding that the overbuilder’s potential free cash flow generation outshines any potential competitive risks.

Sheikh estimated that WOW, which has about 474,000 video and 729,000 broadband customers in 10 states, could generate as much as $250 million in levered free cash flow through 2020, driven by growing demand for broadband and declining capital intensity.

WideOpenWest went public in May at $17 per share, far short of the $20 - $22 per share it has previously anticipated. The stock has traded as high as $18 and as low as $16.50 each since its IPO. 

In his note, Sheikh said WOW shares are attractively valued at an enterprise value/ EBITDA basis (they trade at about 7.6 times cash flow, compared to about 9 times for peers), adding that if the company executes its business plan, that gap should close.

Key to that strategy is broadband Sheikh wrote, adding that demand for high-speed data is high in WOW’s footprint and its fiber network infrastructure enables faster speeds at lower prices compared to competitors.

The main risk is price competition from Comcast or Charter, either by lowering charges for single play broadband or greater bundle discounts with video or wireless in the future.

“It is hard to see why the former would be rational, and we argue the latter is unlikely to erode WOW!'s 50% price advantage,” Sheikh wrote.

WOW stock was up slightly in early trading Monday (1.4%, or 24 cents each) to $17.83 per share.

After a brief early downturn Wednesday, the day after Donald Trump’s upset victory over Hillary Clinton the Presidential election, stocks rallied on hopes of lower taxes and more favorable business regulations under the new regime.

The Dow Jones Industrial Average finished Nov. 9 up 256.95 points to 18,589.69, after a brief downturn earlier in the morning. Investors apparently were encouraged by Trump’s past promises to lower taxes and eliminate unnecessary business regulations to spur the economy.

Media stocks, which were down between 1% and 2% earlier in the day, rallied too. Charter Communications finished the day up 3% ($7.61 each) to $269.87 per share, Dish Network rose 2.2% ($1.25) to $57.93 and Comcast closed the day at $63.45 per share, up 1.5% (93 cents) each. Programmers also saw gains, with Viacom up 1.7% (63 cents) to $37.98; 21st Century Fox up 1.3% (36 cents) to $27.45 and QVC Group up 3.2% (62 cents) to $20.25.

Time Warner shares were down 1.6% ($1.43 each) to $86.44 per share, while AT&T shares rose 1.1% (42 cents) for the day. AT&T and Time Warner announced their $108.7 billion merger late last month, a union that Trump said he would block if President.

In an update of the review of the “accounting issues” that arose earlier this year, comScore said its audit committee is still studying the information it has collected and needs more time before it can complete financial reports for last year and the first quarter of this year.

The issue has affected comScore’s stock and threatens its listing on Nasdaq. Analysts say the review involves the accounting for some non-cash transactions.

 “The Audit Committee continues to work vigorously to complete its review and to report its findings to the Board," comScore said In a filing with the SEC Monday. "To this end, the independent counsel and other advisers to the Audit Committee have completed a substantial amount of their factual inquiries to address the Audit Committee’s review. The Audit Committee and the Board, however, require further time to evaluate the information collected and to reach and evaluate final conclusions."

Read more at B&C. 

Shares of measurement giant comScore plunged more than 30% on Monday after the company said in a Securities and Exchange Commission filing that its board of directors was recently notified of certain potential accounting issues.

In the filing, comScore said the Audit Committee of its board of directors received a message “regarding certain potential accounting matters,” on Feb. 19 and immediately began a review with the help of independent counsel and advisers. On  Feb. 29 comScore filed for a 15-day extension to file its 10-K annual report with the SEC.

While the Audit Committee continues to work on the problem, it notified the board on March 5 that it did not expect to complete its review before March 15. That caused the board to ask for a further extension to file its 10-K and to postpone its Investor Day, scheduled for March 16. In addition, comScore also suspended its stock repurchase program, adding that the buyback program will be reevaluated after the company completes its internal review and files its 10-K.

Comscore stock took it on the nose Monday, falling as much as 33% ($13.23 each) to $27.48 per share. The stock was trading at $29.11 each at 11:28 a.m., down 28.5% ($11.60 each).

ComScore completed its merger with set-top box measurement company Rentrak on Jan. 29. The deal was valued at  about $779 million and was touted as creating a stronger No.2 competitor to industry leader Nielsen. 

Slumping oil prices and continued economic unrest in Asia and Europe pounded U.S. stocks Wednesday as the Dow Jones Industrial Average fell by about  539 points by mid-day, with some cable stocks posting heavy declines.  

It was another day of unrest in what has been a trying month for the stock market, dropping 539 points to 15,474 points by mid-day Wednesday. The Dow Jones Industrial Average is down nearly 2,000 points since the beginning of the year.

Cable stocks took it on the chin Wednesday, with Netflix and Starz leading the decliners, down 6.5% and 6.1%, respectively. The rest of the sector didn’t fare much better, with 21st Century Fox (down 5%), Viacom (down 4.5%), MSG Networks (down 4.1%),  Discovery (down 3.4%) and Disney (down 3.2%) all losing ground.

Distribution stocks fared a little better – Charter fell 3.1% to $162.25 per share; Comcast was down 2.75% to $52.46, Time Warner Cable dipped 1.2% to $175.47 and Cablevision dipped 1.5% to $30.86 each.  

Time Warner Inc. stock rose more than 4% Wednesday on a favorable analyst report, on a day when the Dow Jones Industrial Average plunged 250 points.

According to reports, the stock got a boost after Macquarie analyst Tim Nollen said he preferred Time Warner to other media players like Disney or CBS. Earlier, Pacific Crest media analyst Andy Hargreaves named Time Warner one of his top media sector stocks for 2016.

Time Warner shares closed at $68.62 each on Wednesday, up 4.7% ($3.10 each).

The market endured another volatile day of trading in the aftermath of poor manufacturing data from China. The 250-point decline builds on Monday’s losses of 276 points after China released manufacturing growth figures that were below estimates.

Cable stocks in general weathered Wednesday’s market storm as they did during Monday’s overall declines – with minimal losses and some gains.

Netflix was the top performer for the day, up 9.3% ($10.02 each) to $117.68, after CEO Reed Hastings announced at the CES Show in Las Vegas that the SVOD service increased its global footprint, adding 130 countries including Vietnam, India, Poland and Russia. Other gainers in the sector included AMC Networks, up 1% (74 cents) to $75.43, on the heels of its recent carriage renewal with the NCTC;  and Cable One, up 1% ($4.26) to $434 per share. Scripps Networks Interactive was down 2.8% ($1.50) to $51.90 per share, Comcast dipped 0.77% (43 cents) to $55.22 and Time Warner Cable slid 0.58% ($1.06) to $181.87 per share

Cable stocks took a hit in an overall market sell-off Monday, but most managed to keep losses in check in the early hours of the session, even as the Dow Jones Industrial Average plunged 450 points in early trading.

The Dow was down 450.52 points to 16,974.51 at 11:01 a.m. Monday, the result of what appears to be an economic slowdown in China, according to the NASDAQ website. Weaker than expected manufacturing data and a falling currency triggered a 7% drop in mainland China stocks, leading authorities there to halt trading before the end of the session.

The moves forced many U.S. investors to the exits as optimism for a strong 2016 waned. While some tech stocks were hit hard – Netflix fell 7% and Google parent Alphabet dipped 3% -- cable stocks managed to keep their losses manageable, with declines in the 1% to 3% range.

Charter Communications was down 4%, or $7.42 each, to $175.68 per share in early trading, and QVC Group fell more than 3%, while The Walt Disney Co. was down 2.6% ($2.68 each) to $102.40 and Viacom was down 2.8% ($1.17 each) to $40 per share.

Other stocks showed more modest losses – Time Warner Inc. was down about 1%, Discovery Communications fell about 2%, and Comcast was down about 1.7%.

Cable stocks rode the rising tide of the overall market Wednesday, as the Dow Jones Industrial Average gained 224 points after the Federal Reserve raised short-term interest rates for the first time in seven years.

The move was widely anticipated—it increased its benchmark federal funds rate, which had been held near zero since December 2008, a quarter-percentage-point to between 0.25% and 0.50% from the previous range of 0% to 0.25%. The agency said it expects to raise rates gradually as it sees how the economy performs.

Cable stocks fared well with the rest of the market. Leading the charge was Liberty Broadband, the tracking stock that holds Liberty Media’s interest in Charter Communications, up 3.7%  ($1.84) to $51.52 per share, followed by Cablevision Systems, up 3.1% (94 cents) to $31.22; Liberty Global, up 2.9% ($1.15) to $41.15; Charter, up 2.8% ($5.06) to $183.31; and Time Warner Cable, up 2.2% ($3.98) to $185.06 per share. Comcast rounded out the sector with a 1.6% gain (95 cents) to $58.70 per share.

On the programming side, the gains hovered in the 2% range – Scripps Networks Interactive was up 2.7% ($1.44) to $55.03; MSG Networks rose 2.5% (50 cents) to $20.73; Discovery rose 2.5% (66 cents) to $27.18;  21st Century Fox rose 2.1% (56 cents) to $27.90; and Time Warner Inc. rose 1.8% to $65.90 per share. Rounding out the programmers were Disney, up 1.5% ($1.63) to $113.79; CBS, up 1.4% (67 cents) to $47.50; and Viacom, up 1.3% (53 cents) to $41.51. AMC Networks, which is moving through a potentially contentious carriage battle with the National Cable Television Cooperative, fell about 1% (59 cents) to $77.87 per share. 

Time Warner Inc. stock was down as much as 10.4% ($8.03 per share) to $69.27 each in early trading Wednesday after the media giant lowered earnings guidance and said it was considering curbing subscription video on demand windows, triggering a similar fall-off in other stocks in the sector.

 Time Warner stock ralled later in the day to close at $72.20 each, down 6.6% or $5.50 per share. 

AMC Networks fell the hardest, down 6.8% ($5.24 each) to $71.76 per share, followed by Viacom, closing at $47.92 each, down 6.6% ($3.37 per share). Viacom was followed by Scripps Networks INteractive down 2.7% ($1.67 each);  Starz, down 2.6% (90 cents each);  Discovery Communications, down 2.5% (78 cents each); and Disney, down 2% ($2.29 each).

Time Warner lowered its 2015 earnings per share guidance from $6 per share to $5.25 per share, citing the impact of a stronger dollar and  subscriber declines. While Time Warner did not specifically identify the amount of the declines, it said that subscription revenue was down by about 1% in the quarter.

The Dow Jones Industrial Average crawled back into positive territory Wednesday, finishing the trading session up 619 points and taking cable stocks along for the ride.

Cable shares, which for the most part were up modestly Tuesday, continued to rise on Aug. 26, with Charter Communications having the biggest gain at 3.7%. Other distribution stocks fared well, with Cablevision Systems up 3%, Comcast up 2.9% and Time Warner Cable up 2.5%.

Programmers also had a good day – Disney rose 3.5%, Time Warner Inc. was up 2.8% and 21s Century Fox gained 2.8% for the day.

The Dow Jones  Industrial Average, after an early rally that saw the index rise by as much as 441 points, fell again for the sixth straight trading day, closing Tuesday down nearly 205 points. But cable stocks, which had been hammered over the past several weeks, managed to hold their own, with some even showing small gains during the session.

The Dow closed at 15,666.44 on Tuesday, down 204.91 points. It was an improvement over the 588-point drop on Monday, but showed that the market hasn’t fully rebounded from fears over the global economy. The index last showed a gain on Aug, 17 when it closed at 17,545.18, up 67.78 points. Since then, the DJIA has fallen nearly 1,700 points.

Cable stocks managed to weather the storm well, with some even showing small gains. In the distribution sector, Time Warner Cable closed at $180.72 per share, up about 1% ($1.55 each) and Cable One closed at $413.23 each, up 1%, or $3.24 per share. Other stocks in the sector showed minimal declines – Charter fell 21 cents each to $171.29 (down 0.12%); Cablevision was down 7 cents to $22.59 (-0.3%) and Comcast dipped 56 cents to $53.85 per share, down 1%.

The programming sector, pounded over the past few weeks as investors fretted about cord-cutters, over-the-top providers and poor ratings cutting into profits, fared even better.  Several stocks showed gains, led by Netflix, which rose 4.8% ($4.64 each) to $101.52 per share. Oher programmers that showed increases were The Walt Disney Co., up 53 cents to $95.89 (+0.6%); Liberty Media, up 24 cents to $34.96 each (+0.7%); Viacom, up 43 cents to $38.58 each (1.1%); 21st Century Fox, up 7 cents (0.3%) to 26.73 per share; QVC Group, up 20 cents (0.8%)to $26.62 and Madison Square Garden Co., up $1.85 (2.7%) to $70.69 per share.

Even the stocks that declines kept their losses in check – Time Warner Inc. fell 12 cents (-0.2%) to $69.69 each; CBS dipped 68 cents (1.6%) to $43.27 per share; Scripps Networks fell 34 cents (-0.7%)to $51.38 and Discovery was down 23 cents (-0.9%) to $28.82 per share.

Investors, perhaps seeing some buying opportunities after a morning panic sent the Dow Jones Industrial Average down more than 1,000 points at the open, began slowly crawling back, as the overall market reduced its slide to about 250 points by mid-day.

Cable stocks, which were hit hard along with every other market sector in the morning, began to see some relief, with most stocks gaining back at least some of their losses of earlier in the day.

Pending merger partners Charter Communications and Time Warner Cable, which had been down as much as 7.1% and 4.3% respectively, during the day, entered positive territory by noon. TWC was up 1% ($1.41) to $185.00 per share and Charter rose 0.3% (56 cents) to $177.97 each. Other distribution stocks slowly began to reverse the downward spiral. Cablevision, down 9.4% earlier in the session, finished the first half of the day down 41 cents each (1.7%) to $23.33 each and Comcast, down as much as 4% earlier in the day, was down 1.6% (92 cents) by mid-day. Cable One, which had been unchanged earlier, was down the most – 2.8%, or $11.77 each, to $407.98 by noon time.

Programming stocks also seemed to start on the path to a slow recovery. CBS was up 7 cents per share (0.2%) by mid-day to $45.16 each;  Discovery Communications, down about 5.2% earlier in the morning slowed its decline to 3.1% by noon. Disney, down 7% earlier was down just  1% by mid-day, with 21st Century Fox down 2.5%, Viacom down 1%, Time Warner Inc. down 1.4% and  Netflix, which opened down about 15%, was down less than 1% (35 cents each) by noontime to $103.67 per share.

It has been a volatile past few days for the market – it fell more than 300 points Thursday and more than 535 points on Friday. Cable stocks, which have been on a rollercoaster ride for weeks, were down between 11% and 3.5% since Aug. 17

Cable stocks took a beating Thursday after Sanford Bernstein media analyst Todd Juenger lowered his rating on The Walt Disney Co. and Time Warner Inc. to “market perform,” adding that heightened risk in the sector is calling for a new valuation framework.

The downgrade, coupled with a more than 358-point decline in the Dow Jones Industrial Average -- it's lowest level since last fall -- sent stocks reeling. The Dow closed at 16,990.69, down 358.04 points as investors concerned about growth prospects both domestically and internationally, headed for the exits. IN teh media space, Disney and Viacom felt the biggest hits – they closed  down 6% and 6.3% respectively on Aug. 20, -- but virtually no cable programming or distribution stock was spared.

On the programming side, Discovery Communications fell 5.1% followed by  Madison Square Garden Co. (-4.1%), Scripps Networks (-5%), Time Warner Inc. (-5%), CBS (-5.1%) and 21st Century Fox (-4.2%). On the distribution side, Dish Network was down 4.3%; Charter Communications fell 2.9%; Comcast was down 2.6%, Time Warner Cable was down 2% and Cable One dipped 1.8%. Cablevision Systems rounded out the sector, dipping 2.4% at the Thursday close.      

The declines come soon after the media market meltdown earlier in the month,  when every stock in the sector fell at least 10% at one point between Aug. 5 and Aug. 6.

According to Juenger, the market is now valuing media companies as “structurally impaired assets,” adding that in addition to a secular downturn in the TV advertising business, affiliate fees for cable networks “are being put at increased risk.”

Juenger added that he now believes the market is valuing the domestic TV business like satellite TV, publishing and AOL. Those companies, he said, all have declining subscriber fees and/or advertising displacement and trade at around 7 times cash flow.

Only 21st Century Fox managed to keep its “outperform” rating from the analyst – he said there is just too much growth over the next two years to ignore – but even that stock is approached with caution, as Juenger “worries that FY16 guidance is (again) at risk (already).”

MoffettNathanson principal and senior analyst Craig Moffett raised his rating on the cable sector to “overweight” on Wednesday, citing the sector’s improved basic-video subscriber performance even as cord-cutting continue to chip away at the overall pay TV customer base.

“Time heals all wounds,” Moffett wrote in a recent report to clients.

In a 35-page report, Moffett wrote that despite the true emergence of cord cutting – he says they are now “front and center” – cable has turned in some of its best subscriber performance in years, dramatically slashing losses.

“Cable isn’t just holding its own, it is dramatically improving video even as the sector has trended down” Moffett wrote.

Moffett said declines in the satellite sector – especially at DirecTV – and the loss of telco TV subscribers in the second quarter also bolster the case for cable. But he added that he does not expect the competition to take it lying down.

Already AT&T has announced some aggressive promotions and Moffett expects that to continue and then-some to help the phone giant justify its recent purchase of DirecTV.

“Still, Cable’s advantages are becoming clearer even as sector contraction accelerates,” Moffett wrote.

As far as individual companies, Moffett raised his rating on Charter and Comcast to “buy,” with a 12-month price target of $210 and $67 per share, respectively. Moffett also maintained his “neutral” on Time Warner Cable ($204) and Cable One ($380), and kept his “sell” on Cablevision Systems ($9).