Redstone Discusses Prospects for CBS, Viacom

NEW YORK: Sumner Redstone, the executive chairman of CBS Corporation and Viacom, expressed  "absolute confidence" that the two companies’ stock prices would continue to rise after having been through "a very tough, tough time," he said during an interview with David Faber on CNBC yesterday.

"Our stocks are going up, and we’ve gone through a very tough, tough time," Redstone said. "People have been buying our stocks. Analysts are recommending our stocks. I showed you why. They will go up. I have absolute confidence. And the fact that analysts are putting the target so much higher than the price makes me feel good, because…they share my view, which is obvious that the stocks of CBS and Viacom are very much undervalued. I’m willing to be patient, for a year or two, till they go up fast."

When Faber noted that the share prices of both companies used to be higher, telling Redstone "you were much richer," the mogul responded: "Well, I don’t care about that. You know that. I don’t care about money. I care about winning, and we’re winning," he said, referencing Viacom’s share price increases.

Redstone, when asked by Faber if he was "sad" that the share prices were not what they used to be, said: "No, because I’m an optimist. We’ll be higher than we were. I know what goes on with the operations of these companies. I know the kind of leaders we have of these companies. I know the dialogue we have day in and day out. Of course I would have liked it if the market didn’t collapse. Our stocks were higher. But am I sad? No, cause they’ll be higher than they were."

Faber went on to ask Redstone about Paramount and its value to the overall Viacom group. Redstone noted that Paramount would remain part of the company "forever." He also said that he doesn’t expect to see any further consolidation among the major media companies. "Let them each be on their own, do their best to create good product."

Redstone also noted that "advertising is beginning to come back. As it comes back, the two companies that will profit the most are CBS and Viacom, which are very heavily content-focused. Remember, I said, content is king. And it remains king."

He later added: "Pricing of advertisers is getting better too. Not only is it coming back, but the pricing is better. Well, the signs are all positive now. When we’ll get there? You don’t know. I don’t know. But we will get there. And we will profit from it, as will others—but not as much as CBS and Viacom."

Towards the end of the interview, Faber asked Redstone about his competitors, including News Corp., NBC Universal and Time Warner. Redstone responded: "You gonna compare them to Viacom and CBS? Take a look at the board. You know what is the highest priced stock on the board? Not Time Warner, not Disney, not FOX. Viacom. It’s a manifestation of the preeminence of Viacom."

Faber also asked Redstone about Rupert Murdoch. "I think Rupert is very smart," Redstone said. "He’s a great leader. But I think he’s made a mistake, my opinion. He’s buried in ink. And in my view, there won’t be any real newspaper business ten years from now. Fortunately, we’re buried in television and movies. They’ll be here forever, all over the world."