Last week, Sinclair Broadcast Group (NASDAQ:SBGI) reported its fourth-quarter earnings. Sort of, anyway, and I’ll get back to that in a minute. They were pretty ugly, with net income down almost 80% Y/Y. Not long after, management got on the line for the customary earnings conference call. Which is when things got a little weird.
It's not unusual for a company’s management to filter out certain line items to produce a "core" metric in their earnings reports, and following the DISH-RSN body blow that I described in my last article, a search for a more optimistic "core" number was to be expected. But I frankly wasn’t prepared for the level management took it to. They filtered so much out of the key subscriber figures that the final core metric they described was all but useless to us as investors.
Worse, however, was the statement from management that “misinformation” was pressuring its stock, which had already fallen 50% in 9 months even before the earnings were reported. It fell another 16% in one day after the numbers came out. While admittedly Sinclair is not entirely without possible upside, those like myself who are skeptical of it are most certainly not spreading “misinformation.” It's the numbers, the operating results, that are driving this decline.
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