Categories: OLD Media Moves

Analyst: Dow Jones stock plummets if no deal

A Wall Street analyst who follows Dow Jones & Co. believes its stock price will fall below the level it was at before the disclosure that News Corp. had made a $5 billion offer for the company if the deal is eventually turned down.

Bloomberg’s Allan Wan wrote that UBS analyst Brian Shipman believes that the deal only has a 40 percent chance.

Wan wrote, “Bancroft family members owning 52 percent of the shares said they won’t accept the offer, announced by Rupert Murdoch on May 1. Should they stand firm, shares of Dow Jones, publisher of the Wall Street Journal, probably would fall to below their April 30 price of $36.33, Shipman said.

“Rejection of such a compelling bid is tantamount to confirming that the company is simply not for sale ever and that no deal will be done anytime soon,’ Shipman wrote. He has a ‘neutral’ rating on the stock.

“Shipman said that he doesn’t anticipate another suitor to make a bid as most companies would be reluctant to pay such a high price.”

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Chris Roush

Chris Roush was the dean of the School of Communications at Quinnipiac University in Hamden, Connecticut. He was previously Walter E. Hussman Sr. Distinguished Professor in business journalism at UNC-Chapel Hill. He is a former business journalist for Bloomberg News, Businessweek, The Atlanta Journal-Constitution, The Tampa Tribune and the Sarasota Herald-Tribune. He is the author of the leading business reporting textbook "Show me the Money: Writing Business and Economics Stories for Mass Communication" and "Thinking Things Over," a biography of former Wall Street Journal editor Vermont Royster.

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