E.W. Scripps (SSP) reported earnings in line with consensus but stronger than I had been anticipating. I came quite close to buying October or November at the money puts yesterday but in the end I decided against. As noted in my preview comment, I have a growing concern that fundamentals of the cable network business are deteriorating more than the Street is willing to admit. If this theory proves correct, the ramifications for the stocks of SSP and other major cable network owners (Viacom, Time Warner, Disney, News Corp) could be significant as most analysts are assuming a 13-14 times EBITDA multiple in their valuation models for cable network assets. I still believe my theory could play out in 1H06 but as far as SSP is concerned 3Q05 was another quarter of excellent results for the company’s cable networks with no signs of weakness….

….SSP reported 38 cents in 3Q05 after adjusting for special items. One item will recur but is non-cash as the Denver Joint Operating Agreement which operates the Rocky Mountain News and Denver Post is upgrading its printing plant. Analysts asked a lot of questions about this on the conference call as it will cost the company about 7 cents in 2005 and another 4 cents in 2006. Since this is a non-cash charge and cost savings will begin to accrue the company in 2008, I don