U.S. President Trump suggested that TV networks that criticize him should have their licenses taken away.
Jimmy Kimmel’s suspension is another step in that direction. Jimmy Fallon and Seth Meyers could be next. Before that, CBS announced the ending of The Late Show, hosted by Stephen Colbert. Media firms might be using Trump’s suggestion as an excuse to cut costs. Viewership levels for talk shows declined steadily. Viewers have TikTok, Instagram, and other social networks for unverified, unvetted news.
Even if the government does not follow through with the threat, the risks of investing in various communications firms are on the rise.
Comcast (CMCSA) is a stock to avoid. The stock peaked at $45.31 and closed at $31.59 last week. Valuations are compelling, but investors end up holding a company with weak growth. The firm plans to lay off staff at its Connectivity and Platforms unit.
Fox (FOX) is trending higher. Valuations and growth are poor, while investors get a profitable form that earned positive EPS revisions.
Disney (DIS) is struggling to cut costs from its media content.
The New York Times (NYT) successfully fended off a $15 billion defamation and libel lawsuit, at least for now. A judge tossed the suit, calling the filing "decidedly improper and impermissible." Trump’s lawyers will need to refile their lawsuit within 28 days.
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