No Bull: 2008 -- The Year Newspaper Stocks Collapsed

By: Mark Fitzgerald This was a bad year for stocks, as anyone with a 401 (k) well knows. The Dow is down 36%, the S&P 500 by more than 40%. Yet publicly traded newspaper publishers can only envy that decline.

Yet publicly traded newspaper publishers can only envy that decline.

If the newspaper sector had been able to hold its declines at those levels, GateHouse Media (OTC: GHSE.PK) would still be listed on the New York Stock Exchange (NYSE) instead of looking for a market on the Over-The-Counter Pink Sheets.

If they had held their declines to 40% or less, shares of The McClatchy Co. (NYSE: MNI), Lee Enterprises (NYSE: LEE), and Media General (NYSE: MEG) would all be in double digits -- instead of in danger themselves of being delisted as their stock trades below or just above $1 a share.

The statistics behind the collapse of newspaper stocks in 2008 are sobering as New Year's Eve approaches:

GateHouse, down 99.55% in this calendar year
McClatchy, down 93.6%
Lee Enterprises, down 97.3%
Journal Register Co., down 99.58%
Media General, down 92.47%

Wall Street's antipathy towards the newspaper sector has hammered down the shares of even the rare company investors think is being run well. The share price of Gannett Co. Inc. (NYSE: GCI), for instance, is also down big this year -- losing 80% of its value.

Last New Year's Eve a share of Gannett would put you back $39.50. You could pick it up Tuesday for as little as $7.42. And that's on an up day for the stock. GCI's 52-week low is an even five bucks.

Oddly, the winner in the sector is the company being beat up the most in the financial press, The New York Times Co. (NYSE: NYT). Times stock is down 59% this year.

In 2008, GateHouse, Journal Register and Sun-Times Media Group were all kicked off the Big Board. In recent weeks, GateHouse and Sun-Times (OTC: SUTM.OB) have both traded in the range of 4 to 6 cents or so.

The share price of Journal Register (OTC: JRCO.PK) is calculated in thousandths of a cent on the Pink Sheets. Last week, it hit one one-thousandths of a cent per share.