Two Wall Street analysts downgraded Warner Brothers Music stock last week. Richard Greenfield of Pali Research and Jessica Cohen of Merrill Lynch moved Warner stock from "neutral" category to "sell" and both projected reduced earnings for the company in the next fiscal year. The announcement caused Warner Brothers stock to hit a 52-week nadir of $8.72 last Friday, down from over 27 dollars per share last year. Both analysts cited the media attention given to Madonna, Radiohead, and Nine Inch Nails as mounting evidence against the label paradigm. Greenfield elaborated on the shifting marketplace saying, "we believe an increasing majority of worldwide consumers simply view recorded music as free." Greenfield also noted that Warner had been an example of relative success in the shrinking industry until recently. [CNET]
