During CBS' (NYSE:CBS) Thursday morning conference call, listeners could sense the multibillion-dollar elephant in the room.

Pre-tax pachydermous writedowns of $14.1 billion amounted to a quarterly loss of $12.5 billion ($18.58 a share). To some shareholders, that news would have felt like a Mike Tyson sucker punch. However, after a full day of trading, CBS shares were up by 8%.

Had it not been for the multibillion-dollar impairment, coupled with other expenses netting to $24.4 million, the mass media company would have reported diluted earnings per share of $0.43, about $0.03 higher than expected. After adjustments, that's a nickel lower than the same period last year. Revenue was $3.4 billion -- 3% higher than last year's third quarter.

Its sale of CSI: New York to domestic cable syndicates as well as its recent acquisition of CNET improved the top line. However, without the impact of extraordinary items, CBS' bottom line still would have suffered from generally weak demand for local-level television advertising.

It's a jungle out there
Last month, Sumner Redstone, executive chairman and controlling shareholder, dumped a total of $233 million in nonvoting shares of CBS and Viacom (NYSE:VIA).

Redstone keeps his CBS and Viacom shares on the books of his privately held movie theater company, National Amusements, which has loan covenants tied to the value of those positions. When share prices fell abruptly in recent weeks, he was pressed to choose between breaking the agreement with his lenders and selling the stock. He sold. However, Redstone firmly stated that he intends to hold onto every remaining share he owns in CBS and Viacom.

Foolish lesson
Don't be disheartened by one-time externalities. Despite impairment of goodwill, CBS has prioritized maintaining its dividend, which has been yielding more than 10% at recent prices. If management is truly behind this goal, a combination of cost-cutting and a focus on driving strong free cash flows should suffice. FCF stands at a robust $1.4 billion for the first nine months of 2008.

Furthermore, CBS continues to dominate the network landscape, Showtime has seen steady subscription growth in recent months, and the show Californication recently drew a remarkably attractive price from an international syndicate. More original series are in the works.

CBS appears to be a promising company with some benign issues that it will eventually resolve. At seven times next year's analyst earnings estimate, its valuation is somewhat attractive, but there's no urgent need to rush into this stock. Add it to your news alerts, and go watch the first two seasons of Dexter. Should CBS' stock price continue to fall, then consider taking a closer look.