Grippa. Good info there. I had not seen that. Maybe Gannett will acquire some newspaper companies, though that company has never been known to overpay. Very shrewd operators and definitely a possibility as you state. Thanks for the info
I think you are correct RE the digital properties making MNI attractive and remember that Gannet (along with Tribune) shares ownership of Careerbuilder with MNI. I could see a deal for MNI that splits the publishing and digital properties so that the new (post spin-off) GCI owns it all but under two separate company umbrellas. But remember that Carl Icahn will have something to say about it all since he has taken an activist stake in GCI. Who knows where it's all going. But I fell certain you will see much consolidation in the newspaper biz over the next two years. For the record, I traded MNI and LEE for small profits a few years ago but am long and holding GCI.
grippa- when you look at Gannett sites like the USA Today I think they have figured out how to chart a profitable course and make money in this space. Specifically USA Today has video advertising and videos that engage their audience. The majority of their video advertising is national which MNI can't seem to figure out. I feel like MNI has a great footprint with great assets, but their online papers don't engage the audience like USA Today does and I don't have confidence that the management team has the resources or knowledge to build in video like Gannet does as they leverage their TV stations. I was hopeful that the local media consortium could help with this, but don't hear management mentioning anything about it. I think MNI would be a good buyout candidate in the 5-7 range if you consider that you would get Homefinder and Careerbuilder. Zillow has a 4-billion dollar market cap so Homefinder has got to be worth something and they own 33.3%... What are your thoughts?
@newsad: I wouldn't be so certain, though I think a deal between GCI and MNI or LEE might take a form other than a 100 percent outright buyout. Here's some relevant comment from an article after the GCI conference call last August in which GCI announced the split of the company:
One aim of the split, Martore said, is to make it easier for both the publishing and broadcasting companies to make acquisitions, without being hampered by the F.C.C. regulations that prohibit the same company from owning television stations and newspapers in certain markets.
"It has been difficult for us to, in some cases, be able to look at certain acquisition opportunities that we thought were very attractive because of the cross-ownership rules and other issues," Martore said during the call.
In particular, the publishing company will look to acquisitions as a growth strategy.
In recent years, Martore suggested, Gannett has been unable to pursue newspaper acquisitions because it could not justify such transactions to investors, who preferred the company to acquire higher-margin assets. The spun-off publishing company, though, will be able to pursue these acquisitions, which make economic sense within the context of a dedicated newspaper company.
"It was much more difficult for us to do, from an investor perspective, newspaper publishing acquisitions within the context of the company that we are currently structured in," Martore said.
The newspaper company, she added, will be in a strong position to make acquisitions since it will have no debt and impressive cash flow for a newspaper company.
Translation: GCI will be buying in late 2015 or in 2016. Where? I dunno. But look at the map for where the market synergies are and you will find them. In particular you will find them between current GCI and LEE locations in Wisconsin, for example.
Newspaper- I bought and have been holding this stock and lee since they were trading around 1.25 and have modeled and followed the earnings. I have never commented but have to ask what you think about mmi as a sum of the parts deal. I never hear anything about their stake in Homefinder which if sold I bet would at least pay off the 2022 notes? I feel like they'll generate enough cash to pay off the 2017 notes when due at par. Also if they unload career builder I believe they would be debt free. If they could figure out how to turn revenue it would be a home run stock in my opinion. Problem is... I believe after listening to the cc they have no idea... how to do that. Any thoughts on the value of Homefinder or Career builder.
Grippa, i used to think that Google would one day acquire newspapaer companies but I was dead wrong there. Yes, the revenue slide continues and it seems hard to believe that nearly every business totally ignores print buys as any part of their marketing mix. I doubt that Gannett will buy MNI as they have the same issues with revenue sliding in print. The Washington Post sale, for literally pennies on the dollar to Bezos shows that even the biggest and best names in the business have no street value. I dont know why I still own stock in this company, but over the past decade I have been really good at trading it, shorting it, going long that i feel I have a good pulse on this one. But not lately. If and when it hits $3.50 i'm gone for good.
But the revenue decline continues, as it has for other newspaper companies who reported recently. Until the declines stabilize, the street is gonna continue to penalize the equity prices. The declines create an unsustainable situation, clearly.
Prediction: After Gannett completes its split this year you will see some major consolidation in the newspaper biz, and it will be GCI that does the acquiring, not MNI or LEE. This may actually be a reason to own some MNI, though I do not.
If something looks like it can't go on forever (i.e. revenue declines) it won't. And what must happen (i.e. consolidation in legacy industries) will happen. Lay your bets accordingly.
PJ, actually the operating income was a little better than my guess, it was $41 million. Huge debt reduction on the sale of assets, the long term debt is down to $1 BILLION Thanks Pruitt. I am in this stock at about an average of $3 per share so hoping for a nice runup on this news, maybe to $3.50 or higher. we shall see
I can tell you that not close to their $1.5B current debt. Total market cap is what, around $290M? Gannett seems much better positioned and may buy MNI for pennies on the dollar before long. McClachy just wasn't good at transitioning to a digital model. I live in a city with a McClatchy newspaper and the website is slow, bad GUI, and ad-ridden and losing subscribers by the day. It is a hard cycle to break as they layoff reporters to stay float and then the product gets worse causing more subscriber loss. The sell of their Alaska paper was first of many to come . Not sure McClatchy will weather the digital storm. strong sell here
Sentiment: Strong Sell
Bullish momentum underlines trading in STSC after management confirms new deal with BPS Operating Services LLC, located in Jackson, Mississippi.
Sold all MNI shares today (1/13/15) at the opening at 3.01. My stop of 3 (or lower) was hit yesterday at closing. I had bought shares on 12/23/14 at 3.30. So my loss before commissions was .29 per share. That is 8.79%.
I have purchased a small quantity of MNI shares for speculation. I maintain tight stop on the closing price basis. I keep the stop price unannounced. I live in Modesto, California, and love Modesto Bee published by MNI. Of course I would keep emotions out of my trade, and follow the discipline of honoring the stop (by selling all shares at market the next day opening) if it is hit.. God willing would try to report the result of my speculation on this board.
The classic Sears mistake. It sold off all of its ancillary businesses, such as its credit card and real estate services, to recapitalize and focus on their "core" business of retail, which they were terrible at, right into the jaws of the likes of Amazon.
Did you see that? THE MCCLATCHY just went down. Man I am glad Ultimate Stock Alerts (search
them) gave me a different alert