Digest: Ad growth to slow ... but not for Web
EmptyMedia planning and buying firm ZenithOptimedia reduced its forecast for 2007 U.S. advertising growth from 3.3% to 2.5% citing the current credit crunch and housing slump saying that they are hurting property and construction advertising. The projected 2007 gain is down from the 5.2% growth recorded for 2006. ZenithOptimedia, however, predicts the overall ad industry to benefit in 2008 from the Beijing Olympics. It estimates that the Olympics will boost television's share of the global ad market to a record 38.2% despite a 0.3% percentage point decline to 32.4% in North America. ZenithOptimedia also again raised its forecast for Internet ad gains for 2007 from 28.6% to 29.9%. It cited online video and local search as key growth segments.
Buybacks aren't enough for CBS
Miller Tabak + Co. analyst David Joyce has reduced his rating on shares of CBS from "buy" to "neutral" and cut his price target by $2 to $35, citing lower financial projections. While CBS continues to buy back stock, which boosts earnings per share, Joyce raised his interest expense estimates, which more than offsets the benefits from the buybacks. CBS Class B shares closed down 1.4% on Monday at $31.06.
Sony IPO to raise $3 billion
Sony Corp.'s financial unit will raise $3 billion after pricing its initial public offering at the top end of the expected range Monday. The listing of Sony Financial Holdings, planned for Oct. 11, allows the electronics and entertainment conglomerate to focus on core businesses. The IPO priced at ¥400,000 ($3,457.94) per share, the high end of a range that started at ¥380,000.