What's happening in the headlines can affect you as an investor. Here's what's going on, what you need to know, and what you should expect.
The cold, hard facts
Reuters is reporting that New York Times
The newspapers to be sold include the Sarasota Herald-Tribune; The Ledger, in Florida; the Herald-Journal, in South Carolina; and The Press Democrat, in California. The group in total has a weekday circulation of about 430,000. The sale is expected to close in the next few weeks.
The group's revenue fell about 7%, to $190 million, in the first nine months of this year. "These newspapers have been a drag on overall results due to heavier reliance on local advertising, which lags national advertising growth," Morningstar's Joscelyn Mackay told Reuters. "Without these papers, the firm will be able to focus on its flagship The New York Times and monetize its digital content."
The Times' stock is trading for $7.76 per share, with no P/E to speak of, as there are no earnings to speak of. Shares are down 20% overall this year, though the price did inch up 8% on news of the sale, which comes fast on the heels of a major management shakeup at the company -- i.e., the sudden "retirement" of CEO Janet Robinson.
Obviously, the company is making some radical course adjustments, which it undoubtedly needs. For all the dire predictions of the death of the newspaper, longtime journalistic and industry rival Washington Post
The New York Times is the Times' flagship newspaper, and arguably the country's. For the sake of those invested in the company, as well as for the health and welfare of great journalism, let's hope the company will continue doing what it needs to do to regain profitability. The newspaper is now charging for online access, the first general-interest American newspaper to do so; this was seen as a radical step when first proposed, but apparently the effort is meeting with success. It's a start.
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