CBS 2Q Earnings Fall, Net Beats, Sales Miss

CBS Corp. reported a 48% drop in 2Q net income to $404 million, or $0.55/share, compared to the prior year period in which it had gains from discontinued operations. Adjusted EPS of $0.56 was short of last year's $0.64, but beat analysts' average estimate of $0.51. Revenues were down 3.1% y/y to $3.37b and missed analysts' forecast of $3.42b. CBS blamed the discontinuation of UPN, the timing of the semifinals of the NCAA tournament and the impact of radio and TV divestitures for its decrease in revenues. CBS said it expects full year 2007 earnings to be comparable to 2006, given higher stock-based compensation and asset sales. For the long term, CBS projected growth in the low single-digits for revenues, mid single-digits for operating income and high single-digits for earnings per share. CBS's earnings call is at 8:30 a.m. Check for CBS's earnings call transcript later today. Shares of CBS gained 0.2% to $32.77 on Monday.

Sources: Press release, MarketWatch
Commentary: CBS's Moonves Sees Bleak Future For TV News • Shari Redstone May Leave Viacom After Feud With Father • CBS's Long-Term Strategy Paying Off for Shareholders
Stocks/ETFs to watch: CBS Corp. (CBS), Viacom Inc. (VIA). Competitors: TWX, NWS, DIS, CCU. ETFs: PBS, PEJ

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