Young Broadcasting (YBTVA)

Company

Young Broadcasting "owns ten television stations and the national television sales representation firm, Adam Young Inc. Five stations are affiliated with the ABC Television Network (WKRN-TV - Nashville, TN, WTEN-TV - Albany, NY, WRIC-TV - Richmond, VA, WATE-TV - Knoxville, TN and WBAY-TV - Green Bay, WI), three are affiliated with the CBS Television Network (WLNS-TV - Lansing, MI, KLFY-TV - Lafayette, LA and KELO-TV - Sioux Falls, SD) and one is affiliated with the NBC Television Network (KWQC-TV - Davenport, IA). KRON-TV - San Francisco, CA is the largest independent station in the U.S. and the only independent VHF station in its market." (company website)

Sell short

9-Jun-05. Young Broadcasting has been trending strongly downward for the past twelve months (see sidebar), and the earnings release in early May did not reassure investors. Although the company says it is implementing programs to manage its cost structure, it does not expect to see any impact until the second half of the year. In any case, the company expects net revenues to decline for the year.

• Price momentum (PPO) — the hint of momentum generated at the end of May has dissipated
• Trend (ADX) — flat, with selling pressure (-DI) above buying pressure (+DI), which is declining
• Money flow (CMF) — very strongly negative
• Relative strength (RSI) — weak

Buy to cover

30-Jun-95. I decided to cover my position in YBTVA today, even though the chart looks like there is nothing to stop it from going down farther. What made me nervous was the huge sell-off a week ago. Without much experience with shorts, I became concerned that the sell-off was a final "purge" that might signal a reversal. Those worries intensified this week with two up days in a row. After due consideration, I decided to play it safe and cover.