What: Shares of billboard guru Clear Channel Outdoor (NYSE: CCO ) are sending a clear message today by rising as much as 15.7% on very heavy volume.
So what: Or perhaps the signal isn’t all that clear: An early jump on terrific second-quarter results was followed by a rapid retreat after the customary analyst call, and Clear Channel is actually trading just 3% higher as of this writing. And the stock was exploring 52-week lows to begin with.
Now what: The traditional advertising industry is suffering as a whole. A basket of sector stocks including Clear Channel, Lamar Advertising (Nasdaq: LAMR ) , AirMedia Group (Nasdaq: AMCN ) , Harte-Hanks (NYSE: HHS ) , and National CineMedia (Nasdaq: NCMI ) would have lost out to the SP 500 over the last year with a negative 14.4% return — and that’s with dividends reinvested. It’s no short-term pain either, as the projected annual losses on that mock portfolio grow to 15.1% on a five-year time scale. In both thought experiments, every single stock mentioned has failed to beat the market. As advertisers embrace online marketing channels, I don’t see an end to this pain anytime soon, lest these traditionalists make a leap into the digital realm themselves. Don’t hold your breath while waiting for Clear Channel or Lamar to beat Google (Nasdaq: GOOG ) and Yahoo! (Nasdaq: YHOO ) in the online ad market.
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