In The Wall Street Journal’s picks for Wall Street’s top analysts, Barry L. Lucas of Gabelli & Co. is rated the best in advertising and publishing stocks -- chiefly on his belief in Gannett Co.
Lucas kept a buy recommendation on Gannett (NYSE: GCI) for all of 2009, even as its share price tumbled along with all of its publicly traded newspaper company peers. As Journal writer Suzanne Vranica notes in Tuesday’s article snapping up newspaper stocks even at bargain-basement prices “took nerves of steel.”
"It doesn't take a genius to stick with stocks at the bottom, but this time around you had to be confident that some of the companies would survive," Lucas told the Journal.
Gannett’s stock dropped to historic lows as the industry recession grew into America’s Great Recession, but improving quarterly reports beginning in the summer of 2009 started off a rally in newspaper sector stocks that has only very recently stalled. As the Journal notes, GCI returned 88% in 2009. For the past 52 weeks, the stock is up 191% from its low of $3.10. Tuesday GCI closed up 6 cents to $14.70, almost exactly $5 off its 52-week high, set last month.
"Let me put on my purple Barney-the-dinosaur outfit," says Mr. Lucas, "because I am someone that believes that newspapers are going to be around for a while."
But Lucas also likes Gannett’s non-newspaper holdings, including its broadcast properties and stake in Careerbuilder.com.
Lucas also kept a buy recommendation on the book publisher Scholastic, which paid off with a “three-fold return” from February to December, the Journal reported.
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