October stock slump not so bad

Dow flat during a traditionally tough period

October fulfilled its tradition of being a down month for stocks, but not nightmarishly so, and media stocks mostly followed suit, with the notable exception of strong showings for movie exhibition and broadcasters.

The Dow was flat while the Nasdaq and S&P 500 lost 3.6% and 2%, respectively.

Among the stocks making up The Hollywood Reporter Showbiz 50 index, just 17 were higher during the month, with radio entity Cumulus Media leading the way with a 22% gain to $2.11.

Other broadcast companies making headway included Sinclair Broadcast Group (up 10%), Grupo Televisa (up 4%) and Scripps Networks Interactive (up 2%).

But CBS didn't come to the party, even though it looked it was headed that way a week ago when it traded for $14 a share. By end of trading Friday, though, the stock was at $11.77, down 2% in October.

Turning to movie exhibition, Carmike was up 12% on the month, the third best Showbiz 50 performer. Imax advanced 10% to $10.30 and Regal was up 2% to $12.61.

Some investors are buying shares of the exhibitors ahead of the big James Cameron release of "Avatar," assuming audiences won't only flock to the film, but to the more expensive 3D version of said film.

Merriman Curhan Ford analyst Eric Wold said Regal has 392 3D screens and it expects that it will have 430 in place in time for "Avatar" on Dec. 18.

Imax intends on benefiting big-time from Avatar, which will show on approximately 250 of its screens worldwide, and it is doing quite nicely with "This Is It," the MIchael Jackson extravaganza playing on 97 domestic Imax screens until Disney's "A Christmas Carol" replaces it Nov. 6. Piper Jaffray this week initiated coverage of Imax with an "overweight" recommendation.

Like with the broadcasters, there was a notable exception in the rally among movie exhibitors: Carmike Cinemas, which reports earnings on Monday. The stock fell 5% in October.

Netflix was the second biggest gainer on the Showbiz 50, climbing 16% in October to $53.45. Netflix reported quarterly earnings a week ago that beat expectations just about everywhere.

Still, Wedbush analyst Michael Pachter is "neutral" on the stock becuase the benefit Netflix is seeing from the closing of so many video-rental stores is being offset by the increasing presence of Redbox and Blockbuster kiosks.

Other risers during October included Dolby Laboratories (up 10%), Google (up 8%) and TiVo (up 5%).

At the other end, vidgamer THQ performed worst, losing 24% to $5.23, followed by Blockbuster (down 22%), Live Nation (down 19%), Martha Stewart Living Omnimedia (down 17%) and Lions Gate Entertainment (down 16%).

Among the conglomerates, Time Warner fared the best in October, its stock rising 5% to $30.12. Disney was next, its stock flat on the month, followed by Sony (down 1%), Viacom (down 2%), CBS (down 2%) and News Corp. (off 3%).