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Nomura Securities Maintains a 'Neutral' on CBS (CBS); Surprise, But Looking Past Q2

August 3, 2012 7:39 AM EDT Send to a Friend
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Nomura Securities maintains a 'Neutral' on CBS (NYSE: CBS) price target of $36.00.

Analyst, Michael Nathanson, said, "Last night, CBS reported second quarter EPS of $0.65, $0.05 better than our penny above-the-street estimate of $0.60. The bulk of the beat was sourced by cost savings at its Entertainment segment, which despite coming in $40mn below us on the top line, beat us by $30mn on EBITDA. It seems we misjudged the size of the costs associated with the semi-final NCAA games (which were in 1Q12 vs. 2Q11 last year) and step down in Netflix content revenues, but believe a change in TV show ultimates also helped drive down costs. Lower taxes also contributed $0.03 of the 2Q EPS beat."

"Following through 2Q’s beat and these other model changes, we are raising our 2012E EPS by $0.07 to $2.57 and 2013E by $0.10 to $2.92."

For an analyst ratings summary and ratings history on CBS click here. For more ratings news on CBS click here.

Shares of CBS closed at $33.04 yesterday.




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