CBS shares rise after reporting upbeat advertising sales ahead of 2010-2011 TV season

CBS shares up after positive upfront sales

LOS ANGELES — Shares of CBS Corp. rose 6 percent on Wednesday after the broadcaster said rates improved at its “upfront” advertising sales session for the 2010-2011 television season.

THE SPARK: The New York-based company said Tuesday that it saw “rate increases and total volume commensurate with our number one standing in the marketplace.”

Advertising Age magazine has said CBS recorded price increases for television ads that were up 9 percent to 10 percent per thousand viewers, and had secured commitments for $2.4 billion to $2.6 billion in spending, up from $2.13 billion to $2.25 billion last year. It cited an unnamed source and media buyers.

It also estimated CBS sold 75 percent to 80 percent of its inventory, up from 65 percent last year.

THE BIG PICTURE: An improving advertising market benefits CBS more than other media companies as it has a market-leading position as a broadcaster. More than 60 percent of its revenue comes from advertising.

THE ANALYSIS: By selling much of its inventory, CBS is in an even better position to raise prices for last-minute ad buys during the election season this fall, according to Jefferies & Co. analyst Brian Shipman.

SHARE ACTION: The stock climbed 79 cents, or 5.9 percent, to $14.10 in midday trading Wednesday.