Bullish Indicators Hidden By '04 Basic Sub Losses

摘要

Why, if satellite and telephone companies are going to eat cable's lunch, would Cox Enterprises make investors an offer that implies that Cox Comm. subs are worth almost $5,000 each? Obviously, Cox sees the future differently from investors that are running scared in the new wave of competition panic that has driven our cable MSO average to new lows. Cox's 8/2 offer to take Cox Communications private was a ringing endorsement of cable value, but most investors didn't hear the whole message. The proposal (see P. 12) valued Cox subs at $3,846 each. But since a 20% discount is not uncommon in LBO offers, that implies each Cox sub could actually be worth $4,808.