By: E&P Staff
Merrill Lynch downgraded Dow Jones today from “neutral” to “sell.”
On any valuation metric, the shares are “substantially” above where the comps are trading. According to a note released this morning, Merrill Lynch believes the stock growth rate assumption is too high.
Analysts are also concerned that ad revenue will be spotty for the company especially in late Q3 and Q4, when results will cycle against the September 2005 launch of Weekend Edition. Ad-revenue momentum may not be as robust as expected and could slow, according to the note.
Merrill Lynch reiterates that it does not believe that Dow Jones is on the block, at least in the near term.
Shares of Dow Jones are trading down $.80 to $38.31.