Martha Stewart Omnimedia (NYSE:MSO) reported earnings for its second quarter on Wednesday, and the stock rose 14% higher on the news. I don't buy into the hoopla.

Revenues increased 47% to $67 million. The operating loss was $1.8 million, compared with $34.2 million in the year-ago quarter, and the net loss from continuing operations came in at $0.7 million, or $0.01 per share, versus $33.4 million, or $0.65 per share. The company saw very strong revenue gains in its publishing and Internet segments, booking respective sales growth of 29% and 107%. And the individual segments also reversed massive operating losses recorded on a six-month basis, with the broadcasting division seeing a benefit from its association with Sirius Satellite Radio (NASDAQ:SIRI).

There's obviously a lot of improvement here, more than analysts had been expecting. In addition, the company declared a special dividend of $0.50 per share, which should further contribute to investor giddiness.

Reading over the latest 10-Q, I see that the cash-flow situation has improved. While there still was a net loss in terms of income -- a lesser loss, it turns out, at $6.8 million versus $19.2 million -- net cash from operations jumped 18 times to $17.4 million.

But I still wouldn't buy the stock.

Checking the latest 10-K, I found out that Martha Stewart Omnimedia hasn't really generated any net income or operating cash flow since 2002. For the years 2003, 2004, and 2005, net loss was $2.8 million, $59.6 million, and $75.8 million, respectively. For those same respective years, net cash used in operations was $9.6 million, $22.2 million, and $30.3 million. Granted, these data points may be reflective of the past, but they are rather grim nevertheless.

I also think there are better alternatives out there. Off the top of my head, I can think of two media companies based -- at least in part -- off singular personalities that I believe might offer better long-term reward: Playboy (NYSE:PLA) and World Wrestling Entertainment (NYSE:WWE). Playboy has Hugh Hefner and his hedonistic world as an attractant, while WWE has the arrogant swagger of Vince McMahon. The past cash flows on both companies are better, in my opinion, and in terms of WWE, the company pays a regular dividend that gives the stock a fair return. In terms of a more direct competitor to Martha Stewart Omnimedia, Motley FoolRule Breakers pick The Knot (NASDAQ:KNOT) might also be a more worthy investment idea, especially considering the fantastic quarter it just had.

This special-dividend thing of Martha's is nice and all -- hey, I love dividends -- but I think the company would have been better served retaining the money and growing its business for the long term.

Martha Stewart Omnimedia just doesn't excite me. The financials are getting better, but I'd need confirmation that these improvements can be sustained over the long term before I'd buy. Perhaps the company will get it right in quarters down the line, but until I see some profits and consistent cash flow, I'll pass.

More Takes on Martha:

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Martha Stewart Omnimedia is a former Motley Fool Stock Advisor selection.

Fool contributor Steven Mallas owns none of the companies mentioned. The Motley Fool has a disclosure policy.