VIACA - Entertainment/Media Stocks: Sorting Possible Winners And Losers
No Immunity in This Group
The virus pandemic has exposed serious weaknesses in the business models and strategies of entertainment/media companies, both large and small.
For example, many of them carelessly and stupidly followed the advice of the share buyback cheerleaders…i.e., hedge and mutual fund traders, corporate raiders, and many investment advisers to buy back shares with borrowed money.
There is nothing inherently wrong with such buybacks per se: It returns capital to selling shareholders who can then deploy the funds for their own preferences. And it also offsets dilution from option grants.
But to