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1-Star Stocks Poised to Plunge: New York Times?

Based on the aggregated intelligence of 125,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, newspaper publisher New York Times (NYSE: NYT  ) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at New York Times' business, and see what CAPS investors are saying about the stock right now.

New York Times facts

Headquarters (founded)

New York City (1896)

Market Cap

$726.1 million



TTM Revenue

$2.95 billion


Chairman/Publisher Arthur Sulzberger Jr.
President/CEO Janet Robinson

Return on Equity (average, last five years, and TTM)

(1.9%) and (7.5%)


News Corp. (Nasdaq: NWS  )

Gannett (NYSE: GCI  )

CAPS members bearish on NYT also bearish on:

Ford Motor (NYSE: F  ) (Nasdaq: BIDU  )

CAPS members bullish on NYT also bullish on:

General Electric (NYSE: GE  )

Microsoft (Nasdaq: MSFT  )

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, nearly 75% of the 126 All-Star members who have rated New York Times believe the stock will underperform the S&P 500 going forward. Among the total bearish population are iamacanadian and wjwcapital, who is ranked in the top 3% of our community.

Two weeks ago, iamacanadian tapped the decline of The New York Times as a sign of the times: "The paper-based news source is fading, and as much as the NY Times has done well with their site and on-line content, it won't be enough to keep them going."

In a pitch from one week earlier, wjwcapital publicized the company's dangerous debt load:

This stock looks like a value trap to me with lots of debt ($1.1 billion) and negative working capital of $810 million. Additionally, when intangibles (including goodwill) are removed from assets and only tangible assets are included, the total assets of the Company approximate the total liabilities. I wouldn't be surprised to see some sort of impairment of intangibles needed for the company at the end of the current year, which could further cause adverse impacts to their earnings. Based on these factors, the outlook for the stock does not look favorable in my view.

What do you think about New York Times, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 125,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Baidu is a Motley Fool Rule Breakers pick. Microsoft is a selection of Inside Value. The Fool's disclosure policy always gets a perfect score.

Read/Post Comments (1) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 09, 2009, at 11:41 AM, Varchild2008 wrote:

    The New York Times Commercial always makes me laugh.

    "Start your weekend off with the Weekender!!!" ---I'd rather not have my weekend begin with a newspaper that exposes U.S. National Secrets to our enemies.

    "New York Times delivered at your door step? Who wouldn't want that?" --- Apparently the vast majority of the U.S. Population.

    "I'm not one of those guys that says 'Buy Now' but you should Buy Now." ----Uhm if you aren't one of those guys then you should shut up and not say it.

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