Owners of media company bonds shouldn’t worry when they hear executives talk about returning cash to stockholders. The industry is no longer obsessed with mergers and big investments, much of which used to be paid for with debt. As a result, cash flow “has exploded”, Moody’s Investors Service SVP Neil Begley says in a report today. Even when companies repurchase shares and raise their dividends — things that stockholders love — they will “stop short of levering up” according to the debt rating firm. Begley based his conclusions in part on a study of 25 media companies’ fiscal policies over the last 10 years. He discovered that free cash flow grew an average of 10% a year, even as the percent of cash flow that went to shareholders rose. The companies had $35B last year vs an average of $24B from 2002 to 2008. With the economy improving “we expect (stock) repurchases in 2012 and 2013 will exceed pre-recession peaks of over 100% of free cash flow.” That will stop, of course, if the economy turns south again, Moody’s says.
Media Companies Can Afford Stock Re-Buys, For Now: Moody's
What's Hot on Deadline
Bill O'Reilly To Matt Lauer On His Firing From Fox News & Sexual Harassment Claims: "This Was A Hit Job"
Tucker Carlson Blasts Emmys; Calls It A "Remarkable Triumph Of Identity Politics Over Art & Entertainment"
Latest Film News
- ‘Fall In Love’: Will This Virtual Reality Program Make You Fall In Love?
- Oscars: France Enters Robin Campillo’s ‘BPM’ In Foreign Language Race
- CAA Signs TIFF Rising Star Jessie Buckley; Primary Wave Signs ‘Human Traces’ Vinnie Bennett
- David Tennant & Elisabeth Moss’ ‘Mad To Be Normal’ Headed To Samuel Goldwyn Films
- ‘Star Wars’ Will Receive Promotional Help From Tie-Ins With Six Major Brands
- ‘Kingsman: The Golden Circle’ Review: Suave British Spies Are Back & The Wacko Formula Still Works For Fans