BofA Securities Warns of Rough 2006

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By: Jennifer Saba

The job cuts announced by The New York Times Co. and Knight Ridder (which now includes the San Jose Mercury News as well as the Philadelphia papers) points to more rough times ahead. “At this point,” said a note issued by Banc of America securities on Sunday, “we expect national players, which likely face higher fragmentation and retailer consolidation issues, to continue to be stuck in a quagmire.”

The note, stamped with the headline, “From a slow bleed to a hemorrhage?,” expects more earnings risk in 2006 especially as publishers report Q3 results in October.

Banc of America keeps an eye on The Wall Street Journal and The New York Times ad page counts on a weekly basis. Here is where the two papers are in September:

At the Wall Street Journal, lineage is up in the mid-single digits and up in the double digits when including the Saturday edition. The second Saturday edition included about 15 ad pages (8 were color). The research firm expects Dow Jones to post lineage at the top end of guidance — up low to mid-single digits — for Q3.

At the New York Times, help wanted and real estate print listings are down in the mid-teens and flat, respectively. The telecommunication category declined more than 20%. Movies are up in the low-single digits and department store linage is down in the low-single digits.

For online job postings for September: The New York Times is up 72%; The Boston Globe is up 10%, The San Diego Union-Tribune is up 5%; the St. Louis Post-Dispatch is up 2%; and the New Haven Register is up 6%.

For online real estate posting in September: The New York Times is up 7%; the Boston Globe is up 67%; the San Diego Union-Tribune is up 28%; and the New Haven Register is down 36%.

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