Program: Tuesday, September 2, 2003

The Blockbuster NBC / Vivendi Universal Deal
One On One With Pat Wood, FERC Chairman
Mutual Fund Report With Gene Henssler of Henssler Equity Fund
Paul Kangas' Stocks In The News
Market Stats

09/02/03: The Blockbuster NBC / Vivendi Universal Deal

LINDA O'BRYON: NBC and Vivendi Universal are one step closer tonight to a blockbuster deal. After weeks of speculation, NBC's parent, General Electric, was chosen as the finalist to buy Vivendi's much coveted U.S. entertainment assets. The preliminary deal is valued at roughly $14 billion in cash, assumed debt, and stock. As part of that, Vivendi would keep a stake in the newly formed company. Now, if successful, the merger would transform NBC into one of the world's largest media companies. Scott Gurvey explains.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: If the deal comes off, it will create another multimedia giant, combining a film studio and amusement parks with broadcast and cable TV. NBC Universal will have: the number-one ranked broadcast network and 14 owned and operated TV stations; Universal Pictures & Television with a 5000-film library and TV hits like "Law & Order" and "The Agency; Telemundo, the Spanish-language broadcaster, with 15 owned and operated stations; and a portfolio of cable networks, including CNBC, MSNBC, SciFi Channel, Bravo, and Trio. The company would be 80 percent owned by General Electric, NBC's parent company, with 20 percent held by Vivendi Universal. On a pro forma basis it would have 2003 revenue of $13 billion and earnings before interest, taxes, depreciation, and amortization of $3 billion. NBC had been the only major TV network without a film studio connection. ABC is part of Walt Disney (DIS), Fox Films (FOX) created the Fox Network, and CBS is part of Viacom (VIA), which also owns Paramount. Bob Wright, who has been a NBC for 17 years, will run the new company. Asked in an interview today about the risks of the movie business, Wright admitted it is different, but observed quote: "that two-thirds of the Vivendi deal is about television."

DAVID JOYCE, MEDIA ANALYST, GUZMAN & CO.: But I think that Bob Wright, who has been running NBC for quite some time now, and he'll be the chief executive of this newly merged entity, I think he's well regarded. I think he does have the good focus on the bottom line, and they also have had a very good eye for talent in terms of the programming that they air. So I do think that NBC does has the elements that can bring this together.

GURVEY: The deal is difficult to value, because it is based in part on the future value of GE stock. The companies say it is worth $3.8 billion in cash and stock, and $1.6 billion in debt assumption. The companies have given themselves four weeks to reach a definitive agreement. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

09/02/03: One On One With Pat Wood, FERC Chairman

LINDA O'BRYON: Congress returns from its August recess this week, and one of the top items on its agenda is the state of the nation's power grid following the blackout of 2003. They'll be looking to Pat Wood for some answers. He heads the Federal Energy Regulatory Commission known as FERC. Stephanie Woods spoke with the chairman earlier today, and began by asking him what caused the blackout that left 50 million people in the dark.

PAT WOOD, CHAIRMAN, FERC: Well, the task force that was put together with Canadians and us, folks on the U.S. side, we're still looking at that. It's real important, I think, to get the details exactly right as to what happened. We are clear there were outages in northern Ohio. Whether those were the start of the event or just the visible manifestation of it, I think, we'll get to see. That effort has moved along pretty briskly right now. So I would hope in the next couple of weeks we could get some data out there. And in the analysis, I think, recommendations will come in a longer time frame from the task force.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: So what role did deregulation play in the blackout? Was this a case of self-interested companies making self-interested decisions without anyone in authority looking for the greater good?

WOOD: Oh, I don't think it's quite that obvious. I mean, the transmission grid is regulated. We talk about deregulation of the industry. Quite frankly that means more power plants were allowed to come into the industry and not have to - come into the marketplace and not have to face these erected barriers to entry. But when we talk about the changes that have happened in the industry in the past 10 or 15 years, the transmission grid has been - will be regulated. And so the maintenance of that infrastructure, which some are looking at, again, that could be an issue, it could be just human error, it could be a lot of different things.

WOODS: Do we need to fundamentally rethink deregulation, is the way its come about been too chaotic?

WOOD: I think game plan is fundamentally sound, that you do have a regional threshold for markets and institutions that make sure the rules are adhered to, that investment gets made, kind of the basic things that you need to make any economy work, good rules of the road, market oversight, infrastructure. The speed has been pretty slow. I mean, we got through the natural gas transition in about seven years. This transition is now in its eleventh year in the power industry. And you know, the end not really in sight. So I think speed matters at some stages. You can't be reckless but I think a certain speed to get an outcome where it's peaceful again and people can make investments.

WOODS: Your plan for deregulation has heavy political opposition from southern and western states that have cheap, reliable power and don't want to put that at risk. What do you say to them?

WOOD: I would say certainly that cheaper power actually is in the Midwest. I mean, every cost study we've seen had power flowing from the Midwest into the South. So that would actually compete with the power in South and bring down prices there. So I guess you can connect the dots at that point. But in the Northwest, certainly you do have the federal dams that provide very cheap hydro power. And I think it is totally within the capability of the existing system to allow people to maintain what they have now. It's the incremental -it's the incremental growth in power generation. There's incremental growth in transmission lines. Is that going to be done in an orderly manner or not?

WOODS: Alabama Senator Richard Shelby wants to put your plan on hold until 2007 after your term ends, is that death by delay?

WOOD: It's delay. I think that the regional platform that we have embraced is pretty much welcomed by everybody in all regions in the country. There are tweaks and issues that people don't like, but fundamentally there's broad support for it. Yes, there are some who don't.

WOODS: Does the president support your approach?

WOOD: It's exactly what we did in Texas at his direction.

WOODS: The House Energy and Commerce Committee holds hearings on the blackout this week. The energy conferees will be meeting. What message do you have for lawmakers?

WOOD: Give us answers so we can move forward. But investors, customers, state regulators are waiting for us to act and we're waiting for Congress to act. So once that decision on a broad number of energy issues - and I am one of those that thinks we do need to move forward with the comprehensive legislation that's out there. That we - once those decisions are out there, then we at the implementation level, a lot at our agency, but other agencies as well, the industry, others, can move forward with some certainty that these are the new rules of the road and we can go forward comfortably that that's where they're going to stay.

WOODS: We have been speaking with Pat Wood, chairman of Federal Energy Regulatory Commission. Pat Wood, thank you.

WOOD: Thank you.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

09/02/03: Mutual Fund Report With Gene Henssler of Henssler Equity Fund

PAUL KANGAS: A lot of investors like the sense of security that they get by investing in the blue chips, rather than smaller cap issues. And one mutual fund that has done quite well by investing in large cap stocks is the Henssler Equity Fund. So far this year, it's returned almost 17 ½ percent, and over the past five years, it has posted a very respectable annualized gain of 5.6 percent. The portfolio manager of the Henssler Equity Fund is Gene Henssler, who joins us now from our Washington studios. And Gene, welcome to NIGHTLY BUSINESS REPORT.

GENE HENSSLER, HENSSLER EQUITY FUND: Thanks, Paul, thanks for having me.

KANGAS: First, as we noted, your record speaks for itself. How is it that you have managed to outperform the averages fairly consistently?

HENSSLER: Well, I think there is a couple of things. One is is that we bought quality companies, by quality companies I mean companies with really strong financials. And that sort of eliminates us from buying companies that are weak. And of the 8500 stocks that are listed on the exchanges, that cuts it down to about 800 stocks. And from there, what we try do is buy company that have some growth. And what we look for are companies that have a growth rate in the earnings, plus a dividend, if you add them together, that equals 12 percent. And if we do that, we get down below 300 stocks that we can start to take a look at

KANGAS: Well, you have a lot of - well, really across-the-board holdings in terms of types of large cap stocks that you hold: pharmaceuticals, banks, energy, manufacturers, retailers and even some high tech issues. What does it take for a stock to make it into your portfolio?

HENSSLER: Well, besides having that growth rate and being strong financially, we have to buy at a reasonable price. And how we do that is we take again, the growth rate plus the dividend and we divide it by the P/E ratio of this year's forecasted earnings. And if it has a PEG ratio (UNINTELLIGIBLE) the PEG ratio of less than 1, it meets our qualifications or it's less than the industry.

KANGAS: Right.

HENSSLER: And so what happens is we don't pay for growth at any price, we want growth at a reasonable price

KANGAS: OK. It seems to be a successful formula.

HENSSLER: Yes. It has worked pretty doggoned well.

KANGAS: At last report, Mylan Laboratories (MYL) and PepsiCo (PEP) were your fund's largest holdings. Is that still the case?

HENSSLER: Yes it is. We have held Mylan for a long time. We have held PepsiCo since we started the fund. But in the case of Mylan, we have trimmed it back a couple of times because we like it to keep it under 5 percent

KANGAS: Well, it's interesting to note that utilities are conspicuously absent from your portfolio. Are there no good utilities out there now?

HENSSLER: I'm sure there are some. There's a few that meet our financial qualifications, but when you look at utilities, their growth rate is 5.36 percent. The only thing worse than that is communications, telecommunications at 3 ½.

KANGAS: Well, we just about have 30 or 40 seconds left. Historians say that small cap stocks do better in a post-recessionary market than large caps, but do you think the blue chips will hold onto their own, looking in the future?

HENSSLER: Well, the Henssler Equity Fund is only up - is only down 12 ½ percent while the S&P is down 34. So I think the quality stocks hold their values better, OK? And so while we have had this big growth in small caps, I think it's time for the big boys to take over because these stocks that don't have any earnings or pay any dividends have sort of had the run, especially in technology. I think they're going to fall back.

KANGAS: Gene, I want to thank you very much and we hope that your stock picking abilities continue to serve you well.

HENSSLER: Oh, so do I.

KANGAS: My guest, Gene Henssler of the Henssler Equity Fund.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

9/02/03: "Paul Kangas' Stocks In The News"

PAUL KANGAS: Wall Street's first reaction to that stronger-than-expected manufacturing index report was positive since it underscored recent reports suggesting the economy was gathering upward momentum. After a half hour of trading, the Dow was up 25 points and the NASDAQ rose 8 points. A sell-off in the bond market on that manufacturing news undermined the early rally in stocks. So did over a $2 a share loss in 3M (MM) stock triggered by negative comments in this week's "Barron's" financial magazine. Stocks snapped back however, with the help of brokerage upgrades on IBM (IBM), Seagate Technology (STX), and Fannie Mae (FNM). By early afternoon, the Dow was back with a 41-point gain, NASDAQ up 12. Brokerage upgrades on a number of computer hardware and software stocks led to a surge of bullish enthusiasm for the rest of the session. At the closing bell, the Dow Industrial Average posted a closing gain of 107.45 points, or 1.1 percent, at 9523.27, that's a 15-month high. The NASDAQ Composite ended up 31 points, or 1.7 percent, at 1841.48, that's a 17-month high. The Standard & Poor's 500 Index rose almost 14 points, or 1.4 percent, closing at 1021.99. In the debt market, Treasury prices sank across the board on the widening belief the economy is indeed on the mend. The 10-year note fell 1 5/32 to 97 6/32, lifting the yield to 4.61 percent.

The most active big board issue on 18.4 million shares, General Electric (GE), moving up $0.87 in positive reaction to the exclusive talks on a take-over of Vivendi's entertainment assets that you've heard about.

Pfizer (PFE), second in volume, a $0.54 gain there.

Ford Motor (F) moved up $0.75.

Agere Systems (AGR.A) down $0.13.

Fifth in volume, Motorola (MOT), a $0.09 loss.

AOL Time Warner (AOL) was up $0.16.

Followed by Nokia (NOK), which gained $0.19.

EMC Corp. (EMC) up $0.35. A lot of green on this board.

Citigroup (C) up $0.83.

And Disney (DIS) rose $0.45 a share.

Now we have some computer problems and we're not able to bring you the normal charting tonight. So we'll do it the old fashioned way. Eastman Kodak (EK) up $1.91, the best percentage gainer in the Dow. The story, there is speculation the company will not cut its hefty annual dividend of $1.80 or 6 percent, or even if it does cut, it would be a smaller cut than expected. We'll know on the twenty-fifth of this month, that's when they are set to meet and discuss the dividend.

3M Company (MMM) was down $2.32, one of the big Dow losers. This week's "Barron's" financial magazine cover story suggests the stock has risen too far too fast.

And then IBM (IBM), International Business Machines, up $3.75, the big gainer in the Dow. Goldman Sachs repeated an outperform rating. And as a matter of fact, Goldman Sachs upgraded the entire enterprise hardware group from cautious to neutral.

Moving along, we see Seagate Technology (STX), a gain of $1.54. Goldman Sachs upgraded that stock from in-line to outperform.

International Paper (IP), this is a Dow stock, up $0.34, but it traded as low as $39.64 this morning after Prudential Securities downgraded it from hold to sell.

Fannie Mae (FNM) moved up $2.91. Merrill Lynch upgraded it from neutral to buy. It did the same for Freddie Mac (FRE) whose stock moved $0.73 to $53.88.

Delta Air Lines (DAL), a good gain, up $1.48. Last Friday the company recalled 250 pilots and reduced the number of planned lay-offs of flight attendants from 1000 down to 700. Of course, lower oil prices so far this week also helped the airlines today. The whole group was quite strong.

Republic Services (RSG) down $1.97, after the close of trading Friday, the company cut its full year earnings estimates from $1.47 down to $1.33. And today Merrill Lynch downgraded the stock of Republic from buy to just neutral.

And Terex Corp. (TEX) down $0.80. The Robert Baird brokerage downgraded it from outperform to neutral.

On the other hand, Friedmans Incorporated (FRM), up $1.42. The company plans to accelerate new store growth in 2004 and expects earnings and sales to exceed Wall Street's expectations. Nice move in the stock.

Microsoft (MSFT) topped the active list on NASDAQ, moving up $0.74 in the firm technology group.

Intel (INTC), $0.15 gain.

Oracle (ORCL) system up $0.56.

And then Cisco (CSCO), a $0.45 gain.

Dell (DELL), strong group, up $0.97 there.

eBay (EBAY) down $0.66.

And then KLA-Tencor (KLAC) fell $1.09.

Amgen (AMGN) was up $1.90.

Applied Materials (AMAT), a $0.34 loss.

And Qualcomm (QCOM), number 10 in volume, was down $0.12 a share.

Helen of Troy (HELE) moving up $2.30. The company will acquire Unilever's (UN) Brut line of deodorant and fragrance products for $55 million. And that acquisition is expected to boost 2004 earnings for Helen of Troy by $0.20 to $0.24 a share.

bebe stores (BEBE) up $2.55, the J.P. Morgan brokerage upgraded it from neutral to overweight.

And Research In Motion (RIMM) was down $1.16. This week's "Barron's" financial magazine suggests the stock is overvalued and that competition for the company is getting tougher.

And those are the "Stocks in the News"

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

09/02/03: Market Stats

									   NET    PERCENT
                          CLOSE     CHANGE     CHANGE

DOW CLOSE              9523.27    +107.45      + 1.1
HIGH                                         9535.97
LOW                                          9389.58

NASDAQ COMP.           1841.48     +31.03       +1.7
HIGH                                         1841.48
LOW                                          1804.30

VOLUME                                       1,447.5
PREVIOUS                                       950.8
UP VOLUME                                    1,192.8
DOWN VOLUME                                    234.1

DOW TRANSPORTS         2745.84     +62.60      + 2.3
DOW UTILITIES           243.47      +3.90      + 1.6
CLOSING TICK                                    +109

S&P 500                1021.99     +13.98      + 1.4
S&P 100                 510.86      +7.50      + 1.5
MIDCAP 400              524.11      +5.34      + 1.0
REUTERS/CRB             241.29      -2.41      - 1.0

NYSE COMPOSITE         5732.27     +72.11      + 1.3
VALUE LINE              329.64      +4.90       1.51
RUSSELL 2000             507.5     +10.08       2.03
WILSHIRE 5000          9905.44    +134.98       1.38

U.S. TREASURIES
5-YEAR NOTE 3.25%
Aug. 15,2008          98 12/32     -25/32       3.61

10-YEAR NOTE 4.25%
Aug. 15,2013          97  6/32    -1 5/32       4.61

30-YEAR NOTE 5.375%
Feb. 15, 2031        100 17/32   -1 23/32       5.34

LEHMAN BROS.
LONG BOND INDEX        1670.09     -25.55


DOW CLOSE              9523.27    +107.45      + 1.1
ADVANCES                                        2380
DECLINES                                         908
NEW HIGHS                                        425
NEW LOWS                                           5

                                      NET    PERCENT
NYSE MOST ACTIVES    4PM CLOSE     CHANGE     CHANGE
GE     GE                30.44       +.87       +2.9
PFE    Pfizer            30.46       +.54       +1.8
F      Ford Motor Co     12.31       +.75       +6.5
AGRa   Agere Systems      3.15       +.13       +4.3
MOT    Motorola          10.64       -.09        -.8
AOL    AOL Time Warner   16.52       +.16       +1.0
NOK    Nokia Corp        16.48       +.19       +1.2
EMC    EMC Corp          13.10       +.35       +2.8
C      Citigroup         44.18       +.83       +1.9
DIS    Disney            20.95       +.45       +2.2

NASDAQ CLOSE           1841.48    + 31.03      + 1.7
VOLUME                                       1,781.1
PREVIOUS                                     1,207.8
ADVANCES                                        2249
DECLINES                                         998

NASDAQ ACTIVES
MSFT   Microsoft         27.26       +.74       +2.8
INTC   Intel             28.74       +.15        +.5
ORCL   Oracle            13.39       +.56       +4.4
CSCO   Cisco Systems     19.59       +.45       +2.4
DELL   Dell Inc          33.59       +.97       +3.0
EBAY   eBay              54.75       -.66       -1.2
KLAC   KLA Tencor        58.36      -1.09       -1.8
AMGN   Amgen             67.84      +1.90       +2.9
AMAT   Applied Matl      21.29       -.34       -1.6
QCOM   Qualcomm          41.21       -.12        -.3

AMEX CLOSE              978.24     + 1.79       + .2

INDEX SHARES
DIA    DIAMONDS TRUST    95.46      +1.05       +1.1
QQQ    NASDAQ 100        33.89       +.50       +1.5
SPY    S&P DEP.RECEIPTS 102.80      +1.36       +1.3

STOCKS IN THE NEWS
EK     Eastman Kodak     29.80      +1.91       +6.9
MMM    3M Company       140.15      -2.32       -1.6
IBM    IBM               85.76      +3.75       +4.6
STX    Seagate Tech      24.55      +1.54       +6.7
IP     Intl Paper        40.89       +.34        +.8
FNM    Fannie Mae        67.70      +2.91       +4.5
DAL    Delta Air Lines   14.35      +1.48      +11.5
RSG    Republic Svcs     22.65      -1.97       -8.0
TEX    Terex Corp        22.30       -.80       -3.5
FRM    Friedman's        14.72      +1.42      +10.7
HELE   Helen Of Troy     24.00      +2.30      +10.6
BEBE   BeBe Stores       25.60      +2.55      +11.1
RIMM   Research inMotion 27.32      -1.16       -4.1