"A nice little franchise that overshot after going public, Martha Stewart Living Omnimedia resembles a troubled aircraft that is madly switching pilots while chunks of the plane are flying off.
Big write-downs caused third-quarter losses to exceed total revenue; after all of five months, the chief executive said she would step down; and the company just cut two of its magazines, Whole Living and Everyday Food, as stand-alone products.
Add in the fact that the Hallmark Channel declined to renew the daily “Martha Stewart Show,” and you have a lot less media coming out of a company named Omnimedia. Most of the profits now come from merchandising, but even those are imperiled.
The company signed a deal with J. C. Penney to sell branded Martha Stewart products last year, which was a coup, except that Macy’s accused the company of already selling it those rights and promptly sued. The stock fell to $2.50 a share from over $4.50 at the start of the year. Clearly, it’s going to take more than a few well-placed floral arrangements to make this company look pretty again."