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Viacom Could Lose More Than Half Its Value if Cut By Dish

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Viacom's (VIAB - Get Report) failure to cut a deal with Dish Networks (DISH - Get Report) could be bad -- really bad -- for the New York-based media company.

Bernstein analysts in a note Wednesday presented a dire case for the owner of networks such as VH1, Nickelodeon and Comedy Central in the event it is dropped by satellite TV company Dish. They concluded that if Dish were to drop Viacom (a growing possibility), Viacom would be forced to make painful cost cuts and suspend or dramatically reduce their dividend.

In a best-case scenario, the analysts believe Viacom would be worth $24 a share, but in the more likely worst-case scenario in which Dish does drop Viacom, Viacom's stock would only be worth $16.

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Viacom shares were down up 0.11% to $35.68 in early trading Wednesday after declining about 9% Tuesday on concerns about the impending blackout, while Dish was up 3.25% to $48.86 (Dish reported earnings before the market open Wednesday, with revenue coming in just short of analysts' expectations but adjusted earnings handily beating estimates).

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