CBS: Special $5 One-Time Dividend Likely?

CBS (CBS) was our top large cap media pick for 2010 and we are making it our top large cap media pick again for 2011 due to the strong margin expansion, free cash flow growth profile, and now share repurchases. The shares could increase another 65% this year to $43 based on our multiple analysis, DCF, and sum-of-the-parts valuation. The media conglomerate is more widely known for its TV Network and TV Stations, which together only comprise slightly above a third of company revenues. CBS actually has a diverse collection of businesses including Radio stations, an outdoor advertising business, a film studio, a publishing business - Simon & Schuster, a thriving Internet business through CNET, CBSSports, and Lastfm, TV production and the resulting syndication business, and pay TV networks Showtime and CBS College Sports. CBS is benefiting nicely from a strong rebound in advertising dollars and syndication sales tied to... Read more

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