Scorecards 2009: CBS

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Rating: 2 out of 5

The most advertising-dependent of the media conglomerates will try to catch the wave as the broader ad market will likely continue to rebound in 2010.

CBS shares have run up strongly in 2009 amid expectations of an economic recovery and recent comments from president and CEO Leslie Moonves that ad trends have been improving and that fourth-quarter scatter market ad prices are up 25%. But now the company must prove the growth momentum is real.

"I don't want to be too exuberant," Moonves cautioned at an investor conference in early December. "We are not back yet," but "we're looking forward to '10 with great excitement." He also predicted a stronger upfront ad market in 2010 and a return to year-over-year ad gains at the long-struggling CBS Radio unit as early as the first quarter.

For the first nine months of 2009, the company's TV and radio units' operating profit was down from the year-ago period.

And some warn that the stock may have little upside left in it after the 2009 gains that added up to an improvement of 74% as of Friday, the best performance of the seven conglomerates.

UBS analyst Michael Morris in mid-December downgraded CBS shares from "buy" to "neutral" arguing "that shares adequately reflect the potential for a stronger advertising environment in 2010." He added: " We feel current valuation leaves little margin for disappointment in coming months in the still nascent ad recovery."

Meanwhile, the firm's digital unit, CBS Interactive, saw head Quincy Smith announce his departure recently, leaving president Neil Ashe in charge at a time when the division is looking to find a financial growth path. And the Eye's longtime TV Entertainment Group President Nancy Tellem is segueing to a more advisory role at the company.

Other big events for CBS in the new year include the Super Bowl, which is nearly sold out ad-wise, and the official debut of the company's film unit with a slate led by "Extraordinary Measures," starring Harrison Ford, in late January.

Deal-wise, CBS could in 2010 sell off additional radio stations in smaller markets as it has repeatedly said that it sees the big markets as most valuable.

Top performers

TV shows:
NCIS
The Mentalist
NCIS Los Angeles

Radio shows:
Boomer Esiason and Craig Carton, WFAN, NY
Mike Francesa, WFAN, NY
Kevin and Bean, KROQ, LA
Dr. Laura Schlessinger, KFWB, LA

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