Are You Kidding Me?
By
Ann Sosnowski
Tribune Company’s (TRB:NYSE) attempt to put itself up for sale is just getting more convoluted…
Not only is the company mulling over the Chandler family’s modest bid, as well as a bid by Los Angeles billionaire investors Broad and Burkle, but Rupert Murdoch of News Corp. (NWS:NYSE) fame is siding with the Chandler family for his piece of the pie.
Murdoch believes that Tribune’s Newsday could have “synergy” with News Corp.’s New York Post tabloid.
Additionally, a third bidder, the Carlysle Group, is interested in TRB’s broadcast business only.
Concerning the fate of the Tribune Company, newspaper analyst John Morton stated:
“It’s looking more and more like they’re going to remain intact, though perhaps by selling off some more of their non-crucial assets. Those might include their newspapers in [Hartford,] Connecticut, [Allentown] Pennsylvania, and maybe even [Hampton Roads] Virginia.”
That would suit Tribune Company much better.
In fact, that’s exactly what my favorite newspaper company, The New York Times Company (NYT:NYSE) just did: sold off its Broadcast Media Group for $575 million in the beginning of 2007. It should also sell its New York radio station for $40 million to go on the books for the company’s first quarter.
Despite all the bidding hubbub surrounding TRB these days, its shareholders are still pessimistic on the stock. The company is still below all three major moving averages (the 10-day, 50-day and 200-day), and trades only a little above $30 per share.
It’s important to note a technical aspect of the chart: after TRB announced it had some bidders, the stock rose back to its 200-day Moving Average only to correct again and close as a doji yesterday. A doji is usually a reversal indication, so we should have expected a bit more buying especially on the report that Rupert Murdoch was viewing TRB as an acquisition target. But shareholders still aren’t sure, and today’s tick is a doji as well.
This bodes even worse for the Tribune. In fact, I have a lot of reasons to consider the Tribune a suicide stock.
For more information on Tribune, and why I think it’s a stock you should purge from your portfolio now, you can view my newest TFN “Smart Investing” video.
http://www.taipanfinancialnews.com/videos.php?showID=42&channelID=2
That’s all for today.