Newspaper Stocks: Do Skeptics Have it Wrong?

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(List compiled by Becca Lipman)

The long-standing rumors of the newspaper's pending demise seem exaggerated.

It is true that newspaper industry has been taking hits from all sides. Bloggers and news sites have taken a chunk of readership, and pulling news on-the-go with tablets and smart phones somewhat replaces the need for portable newspaper content.

Then there are sites like Retailmenot, Groupon and Living Social that are carving out chunks of the coupon industry, Craigslist is the new classified section, and bloggers have, in a way, become the new columnists. Oh, you can read the comics online too.

But for fans of the traditional black and while medium, there may be hope yet.

According to AdAge, even though media devices have made an impact on the ways people access their news, traditional media sources (newspapers, books, magazines) still "form the core" of consumer reader outlets.

"This is true for the general population, and it is even true among the affluent Americans that we study, even though they have the discretionary income to indulge in an array of devices, as well as the digital literacy to get the most out of them."

In a poll by AdAge , it was found that 37% of newspaper subscribers are habitual. The greatest main reason for newspaper subscription goes to "local news" at 49.6% followed by coupons at 21%. No word on crossword puzzles.

So the question remains, is there enough leftover demand for newspapers to exist and remain profitable? Will the market bear the unwillingness of many to connect to wifi for their infusion of daily news and comic strips?

To help you analyze the newspaper industry, we list below the newspaper stocks (with market caps over $300M) in order from worst to best yearly performance. For those in the negative, are these stocks being underestimated?

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List sorted by performance.

1. The McClatchy Company (MNI): Publishing Newspapers Industry. Market cap of $178.75M. Current price at $2.1. Over the last year the stock has performed poorly, losing -39.66%. This is a risky stock that is significantly more volatile than the overall market (beta = 3.19). The stock is a short squeeze candidate, with a short float at 48.06% (equivalent to 30.31 days of average volume). The stock is currently stuck in a downtrend, trading -16.18% below its SMA20, -18.59% below its SMA50, and -40.21% below its SMA200. It's been a rough couple of days for the stock, losing 9.09% over the last week.

2. A. H. Belo Corporation (AHC): Publishing Newspapers Industry. Market cap of $128.63M. Current price at $5.98. Over the last year the stock has performed poorly, losing -21.63%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.84). The stock is currently stuck in a downtrend, trading -16.01% below its SMA20, -15.53% below its SMA50, and -23.76% below its SMA200. It's been a rough couple of days for the stock, losing 14.81% over the last week.

3. The New York Times Company (NYT): Publishing Newspapers Industry. Market cap of $1.17B. Current price at $7.99. Over the last year the stock has performed poorly, losing -10.22%. The stock is a short squeeze candidate, with a short float at 13.81% (equivalent to 6.97 days of average volume). It's been a rough couple of days for the stock, losing 11.32% over the last week.

4. Gannett Co., Inc. (GCI): Publishing Newspapers Industry. Market cap of $2.89B. Current price at $12.02. Over the last year the stock has performed poorly, losing -8.03%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.47). The stock is a short squeeze candidate, with a short float at 9.72% (equivalent to 6.92 days of average volume). The stock is currently stuck in a downtrend, trading -11.35% below its SMA20, -12.43% below its SMA50, and -16.95% below its SMA200. It's been a rough couple of days for the stock, losing 11.68% over the last week.

5. Journal Communications Inc. (JRN): Publishing Newspapers Industry. Market cap of $265.79M. Current price at $4.71. The stock has gained 1.73% over the last year. This is a risky stock that is significantly more volatile than the overall market (beta = 3.12). The stock is currently stuck in a downtrend, trading -5.24% below its SMA20, -5.47% below its SMA50, and -7.93% below its SMA200. It's been a rough couple of days for the stock, losing 5.42% over the last week.

6. The E. W. Scripps Company (SSP): Publishing Newspapers Industry. Market cap of $487.31M. Current price at $8.24. The stock has gained 4.7% over the last year.. This is a risky stock that is significantly more volatile than the overall market (beta = 2.58). The stock is a short squeeze candidate, with a short float at 5.52% (equivalent to 6.93 days of average volume). The stock is currently stuck in a downtrend, trading -7.7% below its SMA20, -6.43% below its SMA50, and -11.18% below its SMA200. The stock has performed poorly over the last month, losing 15.31%.

7. Daily Journal Corp. (DJCO): Publishing Newspapers Industry. Market cap of $100.74M. Current price at $73. The stock has gained 5.42% over the last year.. Relatively low correlation to the market (beta = 0.26), which may be appealing to risk averse investors.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks

Referenced Stocks: AHC , DJCO , GCI , JRN , MNI , NYT , SSP

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