CBS Moves on Call Options

Sellers unmindful of Super Bowl Indicator
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NEW YORK: Shares of CBS today rose nearly 5 percent as call sales increased. Around 6,500 of these call options came into play by early afternoon, according to OptionsNewsNetwork, which said one possible reason is that the option price hadn’t met expectations. CBS shares went from opening at $13.30 to trading at $13.77 by around 3 p.m. EST. ONN said the selling activity could also be attributed to a single investor long on shares of CBS.

The media company is expected to announce 2009 fourth quarter results Feb. 18 with analysts forecasting earnings per share of 25 cents. Diluted EPS for the third quarter of 2009 was 30 cents, exceeding Wall Street expectations of 22 cents. TV segment operating income was $440.6 million.

CBS this week announced that it had sold out air-time for the Super Bowl, which pulled in $206 million for NBC last year. The network is capitalizing on the game by scheduling a live interview by “CBS Evening News” anchor Katie Couric with President Obama during the four-hour pre-game show.

Investors selling CBS may not be buying into the Super Bowl Indicator, as described by Mark Hulbert of MarketWatch. This year’s SBI calls for a bullish market, based on the origin of the two teams in this Sunday’s Super Bowl, the New Orleans Saints and the Indianapolis Colts.

“The Super Bowl Indicator, as many market followers know, holds that stocks will rise over the coming year if the winning team can trace its roots back to the original National Football League--and fall if that team's roots are in the old American Football League. Followers claim that the Indicator has a 79 percent success rate, far better than most other popular stock market timing systems,” Hulbert wrote, noting that both the of this year’s rivals started in the NFL.

However, he warns, both teams were from the NFL last year as well, and the market hit a historic low the following March 10.

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