For a fifth consecutive trading day, investors were fleeing Gannett shares this afternoon: GCI's stock recently traded for $2.25, down 23%, after trading as low as $2.21 earlier in the day. The Dow Jones industrials and the broader S&P 500 index are both hovering around 1%, Google Finance is reporting. Today's slide has reduced Gannett's market capitalization to a recent $514 million.Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.
1 buck! 1 buck! 1 buck! 1 buck!
ReplyDelete$2.60 and falling a second ago.
ReplyDeleteThings will now happen in a much shorter time frame. We are now talking days and weeks as opposed to months and years.
Events are about to move quickly.
Oh man, what a nightmare.
ReplyDeleteThis is what capitulation looks like.
ReplyDeleteIn many environments, this sort of stock price would make Gannett highly vulnerable to vulture investors, who would swoop up the company and profit by selling off parts. But with our current financial reality, that game is almost impossible to play (thank God).
@10:34 - it's still very possible to play. it's almost impossible to see how gannett will remain an independent company.
ReplyDeleteGannett is certainly an industry leader
ReplyDeletewhat's also fun to watch is that our yield is creeping up nicely again. we may soon have a 10% yield again.
ReplyDelete@10:39...the problem is that vulture investors like to use borrowed money to do this (which isn't available), and they like to sell off assets in a relative hurry (and it will be hard to dispose of almost all of Gannett's assets, including the real estate).
ReplyDeleteGannett doesn't own very much of value all of the sudden. Newspaper presses? Who wants those? Real estate? There's a huge glut, and the business real estate market is in crisis. Television stations/broadcast licenses? Another rapidly declining business. Online? The only noteworthy online property Gannett owns -- and it's only a part-owner of that -- is CareerBuilder.
Bankruptcy and fire sale, here we come.
Please forget about VULTURES. Vultures don't eat poisonious meat. Gannett's DEBT + Delining Revenues + More Rapidly Declining PROFITS + Loss of READERS + X, Y, Z = stock price of ZERO-POINT-ZERO.
ReplyDeleteThe company will be broken up in a messy -DEBTHOLDER approved- firesale way.
Best way to quickly improve value; neutralize as many HIGH VALUE Salary Targets as possible.
Too bad we don't operate like the Mafia, No Severence for BigWigs.
@10:46 - nonsense. gannett makes a lot of money still, has very valuable brands - even if you don't recognize that - and still often a monopoly in many of its markets. when the economy turns around, there will be an uptick in revenue in these markets. there are still efficiencies to be found by another company that already has all the systems in place to manage a large company.
ReplyDeleteNearly entirely owned by institutional investors, GCI could be forced to sell pieces of itself off to satisfy the demands of the large shareholders that have now seen a complete collapse in value and dividends. The parts are worth more than their sum. The P&Ls of individual papers -- though damaged -- are not reflective of the company's financial health as a whole. And there remain investors [both privately held newspaper chains and investor pools] that would be willing to snap up small market newspapers in the Midwest at much smaller multiples than those entities might have fetched even five years ago. And they'll pay cash. Once divested of newspapers and in some cases local broadcast stations (or at least those not bleeding...) the company is allowed to collapse. It will retain USAT and a handful of larger properties.
ReplyDelete@10:58 -- that is the classic argument for Gannett, and it is the correct one, but sometimes reality is thrust upon you. Gannett's profits are on a scary decline, it's become virtually impossible to accurately forecast things going forward, the company has (out of genuine necessity, I believe) become a lot more opaque in its finances/predicted outcomes, and brand names are only as valuable as people say they are. And the only monopolies they have are newspaper monopolies, which is the wrong monopoly to have right now.
ReplyDeleteYou are right: When the economy bounces, Gannett could be standing in tall cotton. The question is whether they can get there. I think it is a very, very open question.
Re 10:58, Nice to see Gannett management active here. What "valuable brands" does Gannett have?
ReplyDelete11:03
ReplyDeleteWhatever properties they keep, will look a lot like USAT. May even be branded local usat.
What happens next?
ReplyDeleteFirst sell the Arizona Republic, profitable and they haven't run us all the way into the ground yet! Go go gannett go00000000 bankrupt!!
ReplyDelete11:11
ReplyDeleteCant sell AR, they are a asset against the loans. No money would go to DuBlow
When will DeBlow go to Obama and ask for a bailout? Compared to other companies asking for 100's of Billions and he only needing $4 Billion, why not?
ReplyDelete@11:05 You've hit upon the question at hand. Namely whether with their value in a free-fall and little leverage to borrow if Gannett can weather the storm long enough until things start to turn around.
ReplyDeleteAt this point I'd say there's no way they can 'ride out the storm' given the present state of affairs. The options are narrowing at this point.
Grim, but I'd put the possibility at this time of Gannett being forced into bankruptcy or some sort of merger|acquisition at 75 percent.
When the woung is gushing blood, you have to put a tourniquet on a sacrifice the limb in order for the body to survive.
Average daily # of shares that trade for GCI 6.4mm
ReplyDeleteSo far today 5.8mm
It's a rush to dump shares
It appears Wall Street is now treating GCI like one big toxic asset.
ReplyDeleteArmy Times Publishing will probably be sold.
ReplyDeleteI am sooooo glad Tara Connell is in charge of Content One. She will save this company, won't she?
ReplyDeleteNOT!!!
This stock is doomed unless they remove people like Tara Connell, Roxanne Horny, Gracia Martore, Graig Dubow and other losers that are just collecting pay checks!!!
Hi guys! We all knew you'd catch up to us eventually!
ReplyDeleteWhy is the price falling so quickly today?
ReplyDeleteActually Dubow and other's should go to Obama and tell him to quit talking this economy down any further than he already has. What seems lost in his attacks on Wall Street is that a majority of Americans have their retirements and investments tied too it.
ReplyDeleteHe and his administration do it so often that I wonder if his blind trust is selling the whole market short.
@12:02 - gannett now has a junk rating on debt
ReplyDeleteWorth less than NYT
ReplyDeleteIf this is not Failure of Fiduciary Responsibility, I don't know what is.
ReplyDeleteSOMETHING is going on.
Too bad all the best investigative reporters no longer are employed to ferret it out.
The Trees can all Dance and Sing once again
ReplyDeleteBased on filling the downgrades made all debt subordinate to the $1.9B credit line. In the short term they need financing for $632,205 due in May, without that they will have to file for bankruptcy. Looking forward Gannett is basically out of the commercial paper market so the question is how will they refinance the $3,816,942 due in 2011 ($778,464) and 2012 ($3,038,478).
ReplyDeleteThe most liquid/valuable asset in my opinion is Careerbuilder, they could sell their 51% for cash to Yahoo or Microsoft and live for another day. Monster.com is worth $794.63M.
Something else just has to be going on. Stock prices don't fall this quickly, do they?
ReplyDeleteSomeone leaked the big announcement to Wall Street....
ReplyDeleteThe one where the declare chapter 11?
ReplyDeletewhat big announcement?
ReplyDeleteWall Street just read Gannetts papers and found the shitty.
ReplyDeleteAMM is going to tell Gannett's advertisiers how well the paper is working for them.
ReplyDeleteWall Street know that will be the final nail in the coffin to bury Gannett.
The press release below reminds me of an old saying.
ReplyDeleteIt's better to keep your mouth shut and thought to be stupid, then it is to open it and remove all doubt.
AMIS will enable Gannett’s MIMS to capture marketing intelligence and reveal the return of marketing investment for the media company’s advertisers, enabling them to quickly respond to today’s ever-changing marketing environment. It accomplishes this by measuring marketing’s impact on sales, brand and consumer value. Data can be viewed in near-real time on a user-friendly, dashboard customized for each participating Gannett client. Initially, Gannett will deploy MIMS in partnership with a select group of pilot advertisers.
"Something else just has to be going on. Stock prices don't fall this quickly, do they?"
ReplyDeleteIt's called "Panic Selling"!
What Does Panic Selling Mean?
Wide-scale selling of an investment, causing a sharp decline in price. In most instances of panic selling, investors just want to get out of the investment, with little regard for the price at which they sell.
1:12
ReplyDeleteLOL---I was thinking along those lines.
An information company with thousands of employees, bragging about the fact that it has to "deploy" an outside agency to crunch some numbers and spit out some information!!!
What DO all those innovators and analysts who work day after day for Gannett DO all day long?
You don’t need forensic accountants and analysts to discover what went wrong with Gannett as more than a few posters with obvious experience and expertise have already shared most of it on Jim’s blog.
ReplyDeleteDid Gannett’s suits take this opportunity to really listen and act? There’s no real proof they did. Then, again, have they ever? Unfortunately, the question now isn’t what will Dubow do to lead a recovery (he can’t, and the Street’s increasingly demonstrated its lack of confidence for years), it’s what will become of Gannett next.
Terminating Dubow and his team of tools - those with solid records of ineptness, bullying and diminishing results across this company, would be a nice start. Though, that will only happen if the board steps up to act independently, and big.
And, if there was ever a time for them to do so, that would be now.
Hope you all have been saving for situations like this. It's Business 101. Layoffs are coming, along with additional furloughs. Ya all need to spend more time on your resume for McDonalds than wasting it on this blog. I got the time I'm not working and don't plan to. I work for Obama. He sends me my unemployment check. And if things go as planned, he'll be paying my medical bills by the end of the year. Is this a great country or what. Got to go, I'm off to the pool. Enjoy the day.
ReplyDeleteWhat would China pay for the largest newspaper in the USA?
ReplyDeleteMaybe that would change the editorial policies or would the US gov stop them from taking a chunk of our "free" press?
At these prices anything can happen.
GCI is on the brink of disaster, and the board of directors spends two days deliberating over giving out bonuses. So the stock collapses, and we wonder why? If they spent as much time involved in saving this business as they have lining their own pockets, we would not be in the trouble that we are in. Absolute disaster.
ReplyDelete1:55 PM Anonymous said: "Ya all need to spend more time on your resume for McDonalds than wasting it on this blog."
ReplyDeleteummmm with all due respect - McDonalds' stock is up!
Meanwhile will waste more of my time writing out another check to Jim.
Jim - keep up the good work!
They should bring back Stinson and Chris Frey to figure out how to sell more advertising.
ReplyDeleteDid the GCI executive assistants in Crystal Palace get their cash bonuses again this year?
ReplyDeleteVery soon, it looks like I will be able to choose between buying a copy of the Sunday newspaper ($1.50 here) and a share of the company....
ReplyDelete...it's closer than you think for others. Cincinnati goes to $1.75 this Sunday.
ReplyDeleteWhat the stock price is telling you is that Gannett is going to be in bankruptcy soon. The problem is less revenues than debt they have to roll over. There is actually no reason why Gannett can't emerge from bankruptcy a relatively healthy company after they restructure their debt load under court protection.
ReplyDeleteBut equity holders will be entirely screwed, and bond-holders will be partially screwed.
And those of you who still have Gannett stock in your 401k, ouch. Hopefully those parts of the subsids that still have pensions will hold up through bankruptcy even if the government has to take them over (there's a government fund that does that for bankrupt pension funds)
2:54
ReplyDeleteummmm with all due respect - McDonalds' stock is up!
My point exactly, they are hiring. Thanks for confirming that.
Whoa!!!
ReplyDeletePirates of the Caribbean: Dead Man's Press
Nice special effects ~ skin and bones morphing into skull n' bones.
Tomorrow, the worms!
Bankrupt? Don't know about that. Why do you think they slashed the dividend?
ReplyDeleteBut it is a bit like watching investor lemmings run for the cliff.
At some point here, and soon, a vulture is going to be tempted.
But that doesn't mean the whole company will go.
What does Cramer say?
$2.22 per share
ReplyDeleteHow do you love DeBlow now
But I think we should be looking at this in a fuller, more responsible perspective. Wall Street as a whole crashed today at about the same rate overall.
ReplyDeleteIf other stocks were generally rising or holding their own, I think the Gannett freefall would be more worrisome. But investors aren't interested even in stocks that in a healthy Wall Street would be called bargains. Few are buying anything.
I've said it before: Bankrupcy or a takeover and mass selloff would be a godsend to each paper, most of which are profitable and attractive for people who can live on modest profit and who don't have to pay multimillion-dollar CEO and CFO salaries and perqs.
IMHO, in general, the bad news for Wall Street is great news for Main Street. Piecing out and increasing ownership is most industries adds to entreneurialship and capitalistic competition. The irony is that the GOP talks the talk of capitalism, but has been walking the walk in reverse. Unregulated corporations repress competition and bully small businesses out of the market.
OK, so this sucks big time. I'm a longtime employee, and, no, I didn't sell my stock 5 yrs ago or even last year. So much for my savings for my kids' college educations. I know a lot of people want to see GCI go down. But why? Why do we want to see any American company fall, taking the jobs with it? Why do we want to see people's lifetime of savings evaporate? So that we can say a handful of people didn't know how to run the company? The company is still profitable --- more so than Exxon even --- but that debt is a huge problem, no doubt. One sliver of hope: GCI is the No. 1 short-sold stock of the S&P 500. 70.6 million shares are sold short (as of the latest, 2/15 report), and that's 31% of the float. What does that mean? IF --- and it's a big IF --- the economy, and Gannett's fortunes, turn around, there will be a tremendous move by short sellers to cover their positions. But first, the company must get its debt house in order. Yes, it might be too late. Or maybe not.
ReplyDeleteI believe this would happen if we weren't in the worst depression we've ever been in. This is a fact. Most economists do not see things turning around until at least 2012, if then. It has been said today that things will get progressively worse for 2009 and 2010. I wish it were not true, but it is. I hope Gannett has a plan because things are looking very bleak.
ReplyDelete@10:46 - nonsense. gannett makes a lot of money still, has very valuable brands - even if you don't recognize that - and still often a monopoly in many of its markets. when the economy turns around, there will be an uptick in revenue in these markets. there are still efficiencies to be found by another company that already has all the systems in place to manage a large company.
Maybe a company in India will purchase Gannett. I hear they are the only country where the economy is going great. Newspaper readership is at an all time high.
ReplyDeleteJust think — they can outsource their jobs to the good old USA!
Now that would be irony.
What would China pay for the largest newspaper in the USA?
Maybe that would change the editorial policies or would the US gov stop them from taking a chunk of our "free" press?
At these prices anything can happen.
Could Gannett end up in a position to sell its profitable TV stations to cover some of its debt, or would that make matters even worse?
ReplyDelete