Continuing Share Falls Slash Media Company Values
The media sector has continued to feel the brunt of the plummeting stock market this week, with all but seven of the media companies listed in MediaTelINSIGHT Sharewatch showing falling prices yesterday.
Broadcasters can be particularly hard hit in an uncertain economy, doubly so if war does break out. Firstly, advertisers will reign in budgets if they fear consumer spending confidence is about to slip (see Forecasts) and secondly broadcasters’ schedules will become saturated with war coverage, further deterring advertisers from using the medium.
BSkyB closed yesterday down 28p and has fallen by 56p (13.0%) in the last ten days of trading. Carlton Communications shares are down 11.5p (17.6%) over the same period, whilst Granada’s have dropped 7.5p (18.0%). The radio sector has also been hit, with Capital down by 80p (16.3%), Chrysalis by 8.5p (4.3%) and GWR Group by 23p (13.5%) over the ten days.
FTSE’s Technology, Media and Telecommunications (TMT) index has fallen by 8.6% since the beginning of January, as shown in the chart below.
