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Belo Corp. Message Board

  • daninfw04 daninfw04 Apr 27, 2011 4:16 PM Flag

    My Take

    I think most of us agree on the conference call. The CEO needs to develop an illness or some other excuse to be absent in the future. TVL kicked BLC's butt today and had far less stellar results. BLC even declared a dividend. Why did BLC tank? One poster said it eloquently. It's how you answer the question, what you imply and how you dangle the carrot. First, big mistake to start dividend at just 20 cents. Should have started it where they stopped 2-3 years ago at 7.5 cents a quarter. The extra dime is less than $10 million a year. Secondly, you don't declare a quarterly dividend 4-5 months in advance. That's called a special dividend. Next report is due about a month before record date of the dividend they declared today. Duh. This is real sad. BLC should have broken $9 today.......let's not forget market was also up 95.59 points today and we didn't even perform the market. I have found in all past conference call's that the CEO dwells on the negatives and almost skips over the positives as if they weren't worth mentioning. This lady needs to get another job. Even if she's a great executive.....if she can't do a presentation that instills confidence......she needs to go. I almost sold today a few minutes before the call started but could she screw this up? Wel, she did......again. Only good news is we should get some upgrades and we should start attracting the dividend crowd. I still think we will hit $9 next few days. DaninFW

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    • I trade BLC......traders are the ones making the BIG money due to volatility last 2 years....not investors. I trade BLC on 25-50 cent moves probably a dozen times before it hits $ do that math........another poster also explained this to you. I am not a LT holder or care to be. I think BLC will be $14+ in 12-18 months.......probably $20 if they get rid of Dania. DaninFW

    • You miss my point! If you had sold at $10 you would have missed out on its appreciation to $12+ within the next year, costing you at least $100k. So I guess Dunia's performance helped you to not make that mistake.

      No, I'm not married to Dunia or BLC either.

      Boy, what a bunch of whinging whiners out there!

    • The BOD's should be able to figure that out. If not compare PBY to BLC for last 2-3 years. DaninFW

    • You miss my point. I would have sold at $10 which is where it should be. That's actually just over $120K on my 60K shares. I am not married to this stock or Dunia as apparently you are. daninFW

    • I agree with your assessment. I was merely pointing out that Dunia is not looking at any other options......therefore, she should maximize the single minded decision she made. Other options would be better. However, she can only juggle one ball at a time it appears. DaninFW

    • Yes, cash on the B/S has a very low rate of return, but IMO I'd rather have the optionality afforded by the cash then paying off subordinated notes at a large premium when they are yielding only 3%. Just never know what other high return opportunities may present themselves going forward. Perhaps an attractive acquisition comes along and cash allows them to move quickly to close w/o redoing the bank deal and refinancing the '13s. Or credit markets hit an air bubble and you buy back the sub notes on the cheap. Or board would like to implement a special dividend, or perhaps Dunia does an investor presentation and the stock drops to $5/sh again - would be nice to have a pile of cash to implement a stock buy-back plan.

    • Maybe I should mail your posts to BLC?


    • I certainly do not agree. Dunia is being quite properly prudent. Her job is not to pump the stock for short term gains. Her job is to steward the company's considerable media assets and to grow long term shareholder value. How could she not mention what is going on in Japan, the NFL, etc.? She would be a fool not to identify risk factors for the compaany. She has not overpromised for Q2 and that seems wise to me. She has, however, paid down debt, grown CF and is now restoring a dividend. I think that she deserves tremendous credit for steering the company through some pretty tricky waters over the past few years. I am looking forward to continued appreciation over the next year and beyond.

      There is much that she is not saying about mobile but that is also prudent and, perhaps quite suggestive.

      • 3 Replies to kellyoonasdad
      • Kelly, I think you are confusing BLC's management team's ability to execute with their CEO's inability to communicate effectively with investors. As an example, Q&A from yesterday's call:

        You made a point of saying it was at 2.5% yield. What is the initial thinking here around - - do you have a target payout, or are you talk targeting a yield?

        "No, we don't have a target payout, but what we do is look at a yield relative to what other media companies are paying, and
        there are 5 or 6 or handful of media companies that are currently paying a dividend. Some are higher; some are lower, but I would say that the 2.5% falls within that range. Also, if you go back to the years when we were paying a dividend prior to the recession, we generally stayed within that level of a yield. So, it was really more looking at a reasonable yield for our investors based on comparables."

        This is just a dumb comment and demonstrates her lack of financial acumen. Perhaps if the dividend was larger, the stock price would rise in order to reduce the overall yield. Her (or the board's) short sighted view that the stock price is correct and should be used to back into the dividend rate is just ignorant.

        Whether management and the board even considered a stock repurchase plan...

        "That is not something we've contemplated, and the bank agreement actually does not allow share re-purchase right now. I
        know if we were to re-do our bank agreement that conditions are different today, and certain covenants and restrictions that
        existed when we were redoing this deal in a bad market would be different today. But, even having said that, that's not something
        we'd contemplated. We focused on the dividend and that's the announcement that we put out today."

        Saying you evaluated it and decided to go in another direction is fine. Saying you didn't even consider it as an option demonstrates a management team asleep at the wheel.

        Regarding potential uses of excess cash after dividends...

        "That's in another use, Adam, the way that our cash projections would work. We do have the $175 million of notes due in 2013.
        There's a possibility that what you could do is take those notes out with cash. For cash generated between now and then should
        be sufficient after paying the dividend to be able to do that."

        Is this really the most appropriate use of cash for this company? The 6.75% notes due 2013 (btw, Dan, these notes are non-callable) are trading at a price of 107 and yield 3%. If refinanced with bank debt, could lock in low-cost financing w/attractive terms in the 3-4% range. So, as a shareholder, are you happy to hear the CEO saying this is the best use of cash. Especially after she just finished saying they didn't consider a stock buy-back plan (trust me, the cost of capital associated with the stock is much higher than 3%.). Again, her comments exemplify stewardship that does not have a clue.

        Regarding whether management sees the dividend remaining at $0.05 per quarter...

        "Yes. Yes."

        Really? Is that the best she could muster? How about we will continue to evaluate. Or, at least if you rely on the overly-simplistic stock yield analysis, if the stock trades to $12, you will increase it to $0.075 cents?

        I think the key is that everything outlined above is not "spinning" investors. It is the truth and I think BLC's board and Dunia would agree. However, her lack of knowledge regarding financial issues, or her inability to think on her feet, results in extremely poor answers that leave investors confused, or disappointed. I think the reaction of the stock price during and after the calls has proved this out.

      • Kelly,

        Are you a relative of hers?

        This company certainly has value but that does not matter to the Street. What matters is the "perceived" value.

        Otherwise, all stocks would have the same PE Ratio according to their value. Is Netflix properly valued at at 70-80 PE? Heck no. But the Street loves the stock.

        BLC doesn't even have a standard 15 PE. Not with her focus on the negatives. It is a drag to the stock now and quite possibly in the future as well.

        Still hoping for the best...


      • I have heard this argument before.....however, many other stocks are shooting up with far less stellar results....because the CEO knew how to make a presentation. If she really has our best interests at heart why is she destroyiong shareholder value and making it easier for someone to acquire the company at substantially less than it is worth.....I think that would cost us as well. Yes, paying down $175 million in debt in 2 years also increases book value about $2 a share........but if she was indeed prudent, she knows that the Fed is poised to start raising interest rates. The Street is concerned that the 2013's and 2015's (bonds) are due in 2 and 4 years respectfully. It is not prudent not to push back the maturities. They can still buy them back early is they wish. Nobody has a crystal ball. She should take advantage of the current rate environment. If the economy tanks again which is a real possibility and not if but when rates start going up BLC is going to be standing alone again when every other CEO did what was best for their company and shareholders. This lady 2 conference calls back got the call letters mixed up with 3 different stations she was talking about. She doesn't even know the assets she manages. I am not impressed. DaninFW

    • Wow..i was starting to regret selling at the close yesterday at 8.47. Short term i am glad now. I just do not get the behavior of this stock.

    • Has Dunia started a conference call somewhere? Stock trading off...

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