Pali Research analyst Rich Greenfield has strong opinions and today it was News Corp.‘s turn. Greenfield lowered his earnings estimates for the fifth time in five months and downgraded the company to sell from buy. His reasons include the usual—decreased earnings per share estimates for fiscal years 2009 and 2010; the possibility that COO Peter Chernin may not renew his contract, which expires midyear, more likely to Greenfield the longer it takes; hesitancy over stock buybacks.  But his concerns also go to the heart of the company: Rupert Murdoch, chairman and CEO, who Greenfield now sees as a visionary without a strategy for many of News Corp.‘s core businesses.

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From his note to clients: “While we have long viewed Rupert Murdoch as the most visionary CEO in the media sector and one of the only CEOs willing to make long-term strategic investments (regardless of the near-term earnings impact or public investor views), we are increasing surprised/frustrated with his lack of strategic direction related to News Corp’s television station, newspaper and book publishing assets. ... Our fear is that News Corp (NYSE: NWS). is so committed to its existing businesses that it will be willing to sustain businesses that slip into negative profitability for years, (similar to its approach to the NY Post).  We believe several of its TV stations are or will shortly be “in the red,” with book publishing heading for losses, as well as a significant number of its Newspapers.  In fact, on a reported operating income basis, Dow Jones will generate meaningful losses in its first full-year of News Corp. ownership following its $5.7 billion acquisition.” Add in his concern that the rapid internet ad downturn could stop “eliminate” at MySpace and that the probolems in other areas are accelerating.

That makes the growth story—cable, Sky Italia—less compelling. And, Greenfield contends, the hard choices more necessary. Earlier this month, he offered a “wish list” of five items: buy back stock; management buy some stock; extend Chernin’s contract; shut down money losing newspapers; and massive cuts to its TV station operations. The sell downgrade comes because he doesn’t expect any of it to happen.