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Viacom's CFO Departure May Accelerate Buyback
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Banc of America Securities maintained a "buy" rating and $44 target price on Viacom (nyse: VIAb - news - people ), saying the departure of the company's chief financial officer isn't a surprise and may accelerate Viacom's stock buyback. CFO Richard Bressler will remain in his position until his contract expires in March 2006. During his time at Viacom, Bressler disagreed with Chief Executive Sumner Redstone regarding the execution of the company's planned $8 billion stock buyback. According to Banc of America, Redstone recently indicated to investors that the company is willing to let its credit rating slip to BBB+ from A- in order to accelerate the buyback, or for internal reinvestment. In subsequent investor meetings, he reportedly indicated that he and Bressler disagree on the matter. Bressler was closely aligned to former Chief Operating Officer Mel Karmazin, who resigned last year and is now chief executive of Sirius Satellite Radio (nasdaq: SIRI - news - people ). Banc of America said Bressler's resignation won't "come as much of a surprise to most investors and we don't think it is, or will be regarded as, a red flag."
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