The day after a 635-point plunge in the Dow Jones Industrial Average saw share prices take a pounding, the market seesawed back Tuesday, closing up 429 points. As Wall Street rebounded, media and entertainment companies followed suit.
At the closing bell, the Dow Jones U.S. Broadcasting & Entertainment Total Stock Market Index was up $161.59, or 4.82 percent, to $3,517.49.
CBS Corp. shares were up 15.02 percent to $24.51 after Argus Research raised its rating on the stock to buy from hold. The rally came just a day after an absolute rout, in which CBS closed down 9 percent.
Last week, CBS kicked off earnings season for the sector, posting a second-quarter profit of $395 million, or 58 cents a share, up 163 percent from $150 million, or 22 cents a share, in the prior-year period. Analysts had anticipated a profit of 45 cents per share.
Consolidated revenue grew 8 percent to $3.59 billion, half of which ($1.84 billion) was generated by the entertainment unit, which includes CBS’ broadcast and studio business.
Scripps Networks Interactive on Tuesday also enjoyed a turnaround, as shares were up 12.17 percent to $42.20. The company’s Lifestyle Media segment, which includes the cable channels Food Network, HGTV, and Travel Channel, this morning reported a Q2 profit of $288.9 million, up 21.9 percernt from a year ago.
Ad sales totaled $372.9 million, an improvement of 13 percent versus the year-ago $331.5 million.
After shares began to fall precipitously at around 2:40 p.m. EDT, Viacom rallied, ending the day up 7.45 percent to $44.01. The MTV parent company lifted its FY Q3 ad sales revenue by 12 percent, thanks to solid increases in scatter and year-over-year spending growth in 20 key categories.
Discovery Communications also improved, with shares gaining 7.05 percent to $37.20. On Aug. 4, the parent company of the cable networks Discovery Channel, TLC, Animal Planet, and OWN: The Oprah Winfrey Network announced it had beaten expectations with a net profit of $254 million, up 20 percent from Q2 2010.
Ad sales revenues at Discovery’s U.S. networks were up 10 percent to $361 million.