No ads mean bad news in the newspaper industry, and McClatchy Newspapers (NYSE:MNI) isn't exactly swimming in them.

Declining circulations and weak advertising sales have haunted the industry for some time now. A few biggies like The New York Times (NYSE:NYT), Dow Jones' (NYSE:DJ) The Wall Street Journal, or The Washington Post (NYSE:WPO) may find some insulation with their national readership. However, locally specific papers such as Belo Corporation's (NYSE:BLC) Dallas Morning News and Providence Journal, Knight Ridder's (NYSE:KRI) Miami Herald and Philadelphia Inquirer, or Tribune's (NYSE:TRB) L.A. Times and Chicago Tribune don't have that luxury.

McClatchy, with a total daily circulation of 1.4 million, publishes 12 daily and 17 non-daily newspapers, including the Minneapolis Star Tribune and the Anchorage Daily News. Since the industry sees the Internet as a source of strength, it's no surprise that McClatchy has also established websites in each of its daily newspaper locations.

A glance through McClatchy's second-quarter results sheds light on newspaper publishers' current woes. Advertising revenue growth remained in the low single digits at 3%, while circulation revenues declined 3% compared to the year-ago period. Total sales were $302.8 million, a mere 2.2% higher.

For the period, the company earned $44.2 million, up 10.2% compared to a year ago. Through the first six months of fiscal 2005, it has earned $1.63 per share. By year's end, McClatchy anticipates bringing in between $3.45 and $3.55 per share.

Investors may be hesitant to sample this stock, given the above concerns and the company's forward P/E of 19. Nonetheless, McClatchy has been a steady performer since 1996. Its recent price weakness may just be the time to look at this investment a little closer.

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At Motley Fool Inside Value , Philip Durell likes to look for undervalued companies in struggling industries. Click here to see some of Philip's recent selections.

Fool contributor Jeremy MacNealy does not own shares in any of the companies mentioned.