By: Mark Fitzgerald and Jennifer Saba
[In this new daily Web feature, Fitz, Editor-at-Large Mark Fitzgerald in Chicago, and Jen, Associate Editor Jennifer Saba in New York, report and comment on how Wall Street treated the newspaper sector during the trading day. Listen to their weekly business-oriented E&P podcast, “Fitz & Jen Give You The Business” here.]
Goodwill impairment is a lagging indicator, as they say. By the time a newspaper company takes the non-cash charge against earnings — acknowledging the decline in the market value of its overall business or individual papers — the stock price long ago reflected that reality.
But on Monday, Lee Enterprises Inc. (NYSE: LEE) nonetheless got punished for its announcement, made after trading closed last Friday, that it expects to take an impairment charge in the range of $500 to $700 million for its second quarter, which ended Sunday.
Lee’s 4 p.m. EDT trading close was $10.01, down 75 cents, or 6.97% — making it by far the biggest percentage loser on the day.
The biggest percentage gainer was The New York Times Co. (NYSE: NYT), which closed the day at $18.88, up 45 cents, or 2.44%.
Fitz: Speaking of companies with Harbinger issues, how did Media General Inc. do?
Jen: Monday was a victory day for Media General (NYSE: MEG) up a penny to $14.02 on light trading. Let’s call it the Lincoln uptick!
The company announced it closed its acquisition of online shopping site, DealTaker.com. It also said it was taking the proceeds from the SP Newsprint sale — $58 million — to pay down its debt.
Speaking of SP Newsprint, one of the other benefactors of that sale, McClatchy (NYSE: MNI) got no love from the Street today, not even from Lincoln. It was down 20 cents at close to $10.70. The company filed a form 8-K with the Securities and Exchange Commission about its credit agreement with Bank of America.
Fitz: Not even a Lincoln uptick for Journal Register Co. (NYSE: JRC), which ended the day unchanged at 55 cents — or a full 20 cents more than it costs to buy a copy of its flagship Trentonian daily paper in the greater Trenton, N.J., metropolitan area.
With Sun-Times Media Group (NYSE: SVN) now on warning that it could be delisted from the Big Board if it doesn’t get its stock price averaging above $1 within six months, look for JRC to nervously check the mail.
Journal Register has now traded below a buck for 19 straight days, and coming into Monday, its adjusted average closing price for March was 55 cents. Like Sun-Times, Journal Register has been suspended from floor trading.
Here’s how other publicly traded newspaper companies fared Monday:
Newspaper pure-play A.H. Belo (AHC) slowed its long retreat from its $16.35 initial public offering price on Feb. 11. Monday, it closed at $11.43, up 8 cents, or 0.7%.
Gannett Co. Inc. (NYSE: GCI) ended on the up side, closing at $29.05, up 51 cents, or 1.79%.
Community publisher GateHouse Media Inc. (NYSE: GHS) dipped on the day, closing at $5.84, down 10 cents, or 1.68%.
E.W. Scripps (NYSE: SSP) ended at $42.01, up 78 cents, or 1.89%.
Sun-Times Media Group ended at 72 cents, down 2 cents, or 2.73%.