Gannett shares tumbled 3.7% yesterday, closing at $17.77, down 68 cents -- in a stock market riven by a worsening crisis for mortgage giants Fannie Mae and Freddie Mac. GCI was one of seven publicly held newspaper companies whose shares plunged to their lowest point in modern history, says leading blogger Alan Mutter. "Perhaps the worst single trading day ever," he wrote.Capping a miserable week, Gannett's stock traded as low as $17.42, before closing at a level last seen in 1990. Since Monday alone, Google Finance says, GCI has tanked 9.3%. The stock's performance over the past:
Yet, even as the industry approaches a near free fall, Corporate is keeping a weird public silence. No reassuring messages from Chairman and CEO Craig Dubow -- or for that matter, from the other seven members of the board.
I'm especially interested in the newest director, former NBC News president Neal Shapiro (left). Now the CEO of highly regarded PBS affiliate WNET in New York, he joined the board only last October, and was re-elected in April. He's also the board's only journalist. (Dubow's stint as an Atlanta TV ad salesman doesn't count.)
I'm especially interested in the newest director, former NBC News president Neal Shapiro (left). Now the CEO of highly regarded PBS affiliate WNET in New York, he joined the board only last October, and was re-elected in April. He's also the board's only journalist. (Dubow's stint as an Atlanta TV ad salesman doesn't count.)Earlier: Shapiro gives board more journalism experience
Related: WNET president seeks heightened sense of urgency
Your thoughts, in the comments section, below. To e-mail confidentially, use this link from a non-work computer; see Tipsters Anonymous Policy in the green sidebar, upper right.
[Image: Google Finance]
The ship is going down.........when will the rats jump off?
ReplyDeleteLarry St. Cyr to the rescue!!!
ReplyDeleteI think it's time to get realistic here and look at the true future (Gannett or otherwise). And the first question needs to be: Can small, localized dailies in markets (like New Jersey) that are overlapped with big city dailies really survive much longer in their present state? Seems to me it comes down to basic economics.
ReplyDeleteAnd I hate to pick on Jersey, but if the daily paper disappears from Cherry Hill will there be reader outcry? Or will people say "well that's a shame" and start reading the Philly Inquirer?
Whereas in markets like Phoenix and Indianapolis the papers are THE big dogs and even at this grim point does anyone really forsee those publications simply going bye-bye -- leaving those cities along with Des Moines, Louisville, Nashville, Cincy, etc., without any daily printed newspapers?
I think Gannett should look at either spinning off their regional dailies to local buyers (if they can find any) or consider turning them into weekly print products with a daily online component.
I hate to say it, but in overlapping markets, the continued slashing of resources while trying to compete with the big dogs is a recipe for disaster and is not fair to staff or readers.
A weekly newspaper that basically compiles what had been reported all week on the Web provides news to the non-Web saavy crowd and saves a boatload of coin.
That's what I would do...it wouldn't be my first choice, but economically, I see few if any other options.
Jim,
ReplyDeleteI have to agree with you regarding wonderment as to why there has been no comment from the Big Dogs on the plunging stock price. No effort to reassure us that the company is not going down the tubes? They've certainly not been adversly inclined to paint an overly rosy picture before. Why the silence now? Can it be that they can't mislead the stockholders? This is the definition of deafening silence.
I was pondering the problems with the newspaper industry just yesterday and came to several conclusions. While we know that newspapers will eventually be gone, they are going down without a fight. Newspapers need to find a way to keep their online presence immediate, while providing readers with more indepth content in the printed product that they CAN'T get online. I hate reading stories on the Web and then opening the paper the next day and finding the same story ... what a waste. Why not put a follow up to the Web story in the paper or better yet provide more pieces containing analysis.
ReplyDeleteSecondly, it's time to cut the paper's down to tabloid size now. These yearly -- and what seem to be almost constant -- newspaper conversions are way too costly. It's obvious that the goal is to get the printed product as small as possible. And for goodness sakes will someone please make them more lively. It's not like the staid, stoic approach is working.
Thirdly, if Gannett wants to surive in any format, it needs to start listening and responding to what it hears from its employees, clients, and readers. That is the only way that true innovation will thrive.
It is lost on me about the restructuring comment, given all the talk about reductions in staff and the life. My guess is that, if there is a restructuring (e.g., selling off broadcast) that will do little for the stock price since all that will be left are primarily newspaper properties.
ReplyDeleteFrom your own information, those companies are nearly gone (Lee, JRC, etc.) so the pure newspaper play is doomed. Content is king, as is cross-market advertising. Gannett is in decent shape there, if they can figure out how to address that market.
Anon 11:45
ReplyDeleteAll the silence has me wondering if maybe stock price declines just might not be the main thing that's worrying some people.
Not that I'm any expert in finance law, but there may be an SEC mandated/expected silence in the period right before earnings statements are released.
ReplyDeleteI could see where a CEO saying that 'all is well' to prop up stock prices just days before a conference call is made rebutting him/her would be something Sarbox would be concerned with.
What the heck do I know though, I'm just an independent contractor.
@7:37 p.m.: I did consider that possibility, too. But the solution is simple: If Gannett really wants to calm investors, it does what many do: Call the analysts, apologize and then release the earnings report earlier than schedule. The top of the call can be devoted to a soothing (if unconvincing) message about "headwinds" buffeting the company, shareholders shouldn't worry, blah, blah, blah.
ReplyDeleteThere's a so-called "dark period" before earnings in which management can't talk about company performance.
ReplyDeleteHow long does this "dark period'' last? I ask because Gannett's stock has been on a slide for quite a while now.
ReplyDelete