Gannett shares plunged 11% today, closing down 26 cents at $2.11, as investors across stock markets sent the Dow Jones industrials and other indexes deeper into the basement. For GCI, it could have been worse: By the close, shares had bounced back from $2.08, a new record trading low.
Today's dive reduced the No. 1 newspaper publisher's total market capitalization to just $482 million, Google Finance is now reporting. That is less than half Gannett's value barely three weeks ago, when it first breached the $1 billion threshold.Overall, investors stampeded from stocks today, as a brief burst of optimism disappeared, the Associated Press says: "The major market indicators extended their slide to levels not seen in more than a decade as investors contended with more disheartening economic data, new concerns about the stability of General Motors and ongoing uncertainty about the financial system."
The Dow Jones industrials and the S&P 500 index are both down 4%.
Oh my.
ReplyDeleteInvestors bought cheap yesterday and sold today. Look for it to decline slowly until we have another round of bad news. The stocks will fall sharply, investors will buy the next day for a rally and then sell off.
ReplyDeleteRepeat, rinse, repeat.
Dow isn't done falling by a long shot.
The chrystal tower can't do anything except watch it happen.
Oh dear.
ReplyDeleteNone of us could have anticipated ...
Why is the NYT not crashing as bad as GCI?
ReplyDeleteThe NYT puts out quality. Quality sells. Even outside of NY. Even though it costs $24 a month for 7-day delivery. The Times is picking up where hometown papers are leaving off.
ReplyDelete1 buck! 1 buck! 1 buck! 1 buck!
ReplyDeleteI wondered out loud to a coworker how low Gannett's shares could go. He suggested taking up a pool — two dollars? one? fifty cents? — but then we stopped, realizing what that would mean. Stocks can trade for fractions of a penny. And we would be betting against the devil.
ReplyDelete11:06 there is not one GCI paper that comes close to the NYT - never was and never will be.
ReplyDelete@11:57a - I think we all know what this means.
ReplyDeleteSuffice to say that many of our Gannett brethren may not be so for much longer. Whether they are 'reduced,' their entity is no longer a GCI property, or worse.
Shouldn't the headline read "... fight to stay above $2" not $3?
ReplyDeleteabove 2, you mean... (headline)
ReplyDeleteAnd, you know, Bank of America stock was fighting for $4 a share yesterday or the day before, so context is important here.
ReplyDeleteI say this is a great thing. Profitable companies like Gannett should be forced out of corporate hands and into the hands of people owners.
The law doesn't hold corporations accountable the way it does people. A public company or corporation isn't a person and doesn't serve people. Its mission is solely to gain profits for investment organizations. A private company, however, is responsible to consumers in a capitalistic society, and it must attend properly to employees who represent those accountable owners.
I contend that corporations are anti-capitalistic and inherently bad. The transition will be tough, but I welcome it.
12:20 and 12:21 pm: Thanks!
ReplyDeleteGannett's practice of buying and disemboweling newspapers of every last vestige of journalistic excellence has put the company's stock in the discount bin. The recession only accelerated the tailspin. Gannett's business plan of gouging advertisers for space alongside fluff, press release rewrites and poorly written and researched stories guaranteed the company's doom. Too bad the company didn't sell some of its papers in 2007 to high bidders like Zell and Tierney. Instead, it's gutting its papers even further. By the time it decides to sell its papers, they won't be worth much. I'll give all my Gannett stock for the Westchester papers.
ReplyDeleteCould someone update me...
ReplyDeleteI fled from this miserable company a few years ago and sold all my stock and converted my 401K then....
At that time, publishers and EEs and MEs and ad directors who received bonuses got it entirely in Gannett stock - but that stock was awarded at a "set" price... maybe $55 or $65 a share depending on when...
So when the stock went up... and you sold, you got the difference between what you "bought in at" and what it is now worth. That was the case with me and many others, I believe.
NOW... has this changed since I left?
Or.... are all those Gannett publishers and editors now sitting on worthless stock if they didn't sell it a few years ago?
Or did something change in the last three years to "bail them all out" so to speak???
Just wondering...
Citi's abysmal stock plunge is CNN's lede online at the moment ...
ReplyDeletehttp://money.cnn.com/2009/03/05/news/companies/citigroup/index.htm?postversion=2009030511
I'm assuming GCI will get the same treatment sooner rather than later ...
12:31 pm: Many, many of those publishers and other operating committee members are now sitting on worthless stock options. They are financially ruined.
ReplyDeleteThis is because Gannett's stock never rose above the strike price (what you called the "set" price), and instead went lower. This is happening right now with the more than 1 million stock options just given to the top brass.
There also are publishers and other directors who were able to exercise options. But instead of selling the shares to better diversify their holdings, they held the stock. This may have been out of fear -- real or imagined -- that Corporate would discover any sales, and view them as a sign of disloyalty.
I can tell you this, however: I recall Doug McCorkindale selling thousands and thousands of his shares during the last year he was board chairman. The stock was trading then for around $55.
At the time, spring 2006 -- before I started blogging -- I asked spokeswoman Tara Connell why McCorkindale was selling so much of his stock. In other words, what did his stock sales say about his view of the company's prospects?
Connell told me what I suspected: McCorkindale had agreed to a contract with the board of directors, an agreement that major stockholding executives often are asked to sign in many companies.
It specified that, if he wanted to sell GCI shares, that he do so by selling a fixed number each quarter. That relieved has diversification efforts of any unintended signals to the market.
Still, it was smart trading, too. Can you imagine how wealthy he must be today? I would think this would drive The 11th Floor crazy, since they got stuck with the clean-up from all the previous CEOs.
No reason to "recall" or speculate, Jim.
ReplyDeleteIf you want to track muckamuck trades:
Yahoo Insider Transactions (Gannett)
I just love the people here routing for the stock to tank. Screw all of you. How dare you rout for people to lose their jobs. You are scum. Just because you don't like Gannett doesn't mean you have to leap for joy that thousands of workers could be without jobs if this freefall continues. I hope karma comes around and you lose your freakin job aholes.
ReplyDeleteI know I meant rooting before anybody says anything
ReplyDeleteIf you think Gannett is bad, google Journal Register's bankruptcy filing. They want to pay $1.7 million in bonuses for managers who made layoff goals! Really. Connecticut AG fighting this.
ReplyDeleteOK people lets get one thing straight! I enjoy that Gannett, the goliath, is finally seeing its demise and I am sure that alot of mistreated employees feel the same. The old addage "What comes around goes around", is true. But lets get down to facts. The economy is jetting down so lets not write the newspapers off and say they are all going to shut-down. To the contrary they will not! Why? because as the times get tougher the people out there cannot afford the internet and also cannot afford to get computers updated nor literate. Right now we are experienceing a staus quo of history where the giants of monopolies are going to collapse and we will all go back to privately owned newspapers in our major cities. Yes even if they look like "Pennysavers " in the begginning. They will eventually grow. We have and are witnessing a golden age when conglomerates of giant newspapers will have to be broken up and indiviually sold to the common business people of each cities. Yes, some will collapse but the ones that survive will prosper. Until all the younger people and current mid aged people can afford the internet and computer neccesities......... there will not be the "proverbial tombstones" of newspapers! So please will every "chicken little " please grab their socks and enjoy the roller coaster ride of the corporations that have raped us for the past eight years! This will be fun to watch unless the paper you work for is a paper that doens't make money. Then you will be the local pennysaver? I hope not, but hail to the collapse of Gannett!!!! Anyone that is someone that has worked over 15 years or more realizes their demoralizing and thievery tactics!! Off wit their bloody heads.............crooks!!!!!!!
ReplyDeleteGet rid of all the overhead and demoralizing tactics and bad managers and you might have a newspaper!
1:50 pm: Thanks, and I've seen those databases before. Unfortunately, they don't go back in time far enough to capture the McCorkindale stock sales.
ReplyDeleteYou had it right the first time!
ReplyDelete"I just love the people here routing for the stock"
routing: A disorderly retreat or flight following defeat.
"I know I meant rooting before anybody says anything"
rooting: To lend support to someone or something.
The title reads "rout", not "root".
To clarify, we are rooting for GCI, but routing from the stock slide!
11:06, As I type this, Gannett is down 10.13% and the New York Times is down 11.16%.
ReplyDeleteQuality counts, but it's not what's killing print.
I just heard a vicious rumour................that the board decided to let the stock drop to .99 cents and then they are taking long overdue action and are going to mass market the stocks through the .99 cents stores across the united states!!!Three cheers for the board a day late and alot dollars short from their inactions! Gannett is too top heavy of a corporation to last in this economy! The rise and fall of the "bushism", the evil doers!!
ReplyDelete11:01AM---DECLINE SLOWLY?? Wake-the-Fu*k up buddie. It was $32.00 12 months ago...now is $2.15.
ReplyDeleteThere is not more decline. There is only waiting to HIT >>
ZERO-POINT-ZERO.
Anybody "Playing" this stock at this level is just sitting down at a roulette well. Enjoy the gambling.
"Thanks, and I've seen those databases before. Unfortunately, they don't go back in time far enough to capture the McCorkindale stock sales."
ReplyDeleteNo problem!
Citizen Journalist to The Rescue
Maybe this makes up for the Tara exegesis.
I believe McCorkindale sold 1,000,000 SHARES in 2005 @ $60 Per Share. All that GANNETT debt he created is trading for 60 CENTS on the Dollar.
ReplyDeleteGotta give the co*ksucker credit for selling High.
"Never try and catch a falling knife"
ReplyDeletehttp://www.fool.com/investing/general/2009/03/05/2-star-stocks-poised-to-plunge-gannett.aspx
Jim - Thanks for the information on the stock options and how they are handled.
ReplyDeleteIt is as I feared, in a way.
It is sad because some good friends are stuck with this worthless stock. But at the same time, some of the worst of the worst in publishers and editors are also holding the worthless paper.
The bad supervisors are getting what they deserve - going broke - but those few good folks out there are also stuck.
Lest anyone forget, there are still some very good people still working at Gannett and sadly their future is at stake. Given that those responsible have demonstrated little ability to stop the decline prospects are certainly grim.
ReplyDeleteI do not work at Gannett anymore, but I offer prayers for those who still do. These are real people's lives at stake.
This comment has been removed by a blog administrator.
ReplyDeleteI've removed and am now reposting the following comment by Anonymous@4:35 PM, to remove (XXX) some unnecessarily inflammatory language.
ReplyDeleteMcCorkindale is a XXX. He sold as soon as he left the company. Clearly he did not have any faith in Dubow growing the stock. Check the SEC records at the end of 2005 and mid 2006 and you will see this guy dumped everything as soon as he legally was allowed to.
We should have known then that Dubow had no backing from the man that appointed him.
I see that XXX McCorkindale driving around his Aston Martin from golf course to golf course and from boat to boat.
XXX.
So, it looks like GCI is now off its 52-week high by nearly 94 percent.
ReplyDeleteWhich will not go unnoticed by Craig and the other Dubows. But assuming it slips under two bucks and stays there, could that prompt the next round of furloughs and layoffs to be even deeper than what's now being contemplated (whatever that is).
Or, will this accelerate the concentration of mastheads in a region, e.g. Indiana, Southern Tier and basically turn these papers into a skeleton of a skeleton?
On the TV side, we could see something along the lines of what happened in Syracuse, where the NBC and CBS affiliates combined newsrooms, so now NBC will be producing the news for both stations, throwing 40 people out of work.
Both companies are doing a similar deal in Peoria.
I wouldn't put it past Gannett to look for a similar deal elsewhere. Everyone's hemorrhaging cash. What was once unthinkable is now pragmatic.
Thats all right McCorkindale is getting XXXXXX over on his Continital Airline shares now.
ReplyDeleteI was laid off in December. At the time it was crushing to me. While I am still looking for my next venture, Boy am I glad I am not in that hell hole. Sad thing is that there are many good people at Gannett, being lead by people who can not find their own asses with two hands let alone find the direction Gannett needs to go.
ReplyDeleteJim @ 1:34 -
ReplyDeleteYou could not be more wrong about this:
"There also are publishers and other directors who were able to exercise options. But instead of selling the shares to better diversify their holdings, they held the stock. This may have been out of fear -- real or imagined -- that Corporate would discover any sales, and view them as a sign of disloyalty."
That paragraph is just plain old shit-stirring. I thought you used to be a REPORTER?
The company sees EVERY stock option exercise AS DOES EVERY COMPANY THAT GIVES STOCK OPTIONS TO ITS EMPLOYEES!!!!! Nearly ALL employee stock option exercises are done as "cashless" exercises, where the option is exercised and the stock sold in the same transaction.
No one is afraid of being seen as disloyal for exercising options. Literally thousands of Gannett executives over the past 30 years have exercised stock options and NOT kept the stock.
Do you really just not understand how executive compensation programs work or do you just like stirring up your rabid readers?
Also, to the person who said publishers, EEs and MEs were required to take their bonuses in stock --- wrong. Top executives are required to take a percentage of their bonus in stock, not the entire value. Publishers, EEs and some MEs get long term incentives in the form of stock options, but that is separate from the annual bonus program.