The New York Times Company (NYT) is feeling the pinch today as it sold one of its most storied assets, The Boston Globe, the most expensive acquisition in The Times Company's history at $1.1 billion in 1993. The paper will now belong to local billionaire and owner of the Boston Red Sox, the former commodities trader John Henry.
The cost? A staggering loss for the The Times Company at $70 million, which many are pointing out is less than what Henry shelled out for his second baseman.
To some, the fact that a 141-year-old media outlet and one of the biggest names in journalism is now equal in market-value to just one of the town's many notable athletes is a sign that the times have changed, and the day of the major media conglomerate is over.
Other indicators also seem to suggest that major newspapers are shifting their focus back to local news as they try to hold on to a shrinking subscriber base. The main reason? Media empires have become sprawling, uncontrollable giants – where CEOs can be an entire continent away from the local advertisers their newspapers often need to recruit in order to stay alive.
Newspapers used to have a monopoly on certain kinds of information, a monopoly which was practically lost overnight with the invention of the internet. This led to some intense jockeying amongst newspaper companies as they struggled to find ways to get customers to pay for content they could suddenly access for free.
Different companies have used strikingly different approaches to staying profitable. The Washington Post Company (WPO), for instance, profited off of the rise of the test-preparation industry by acquiring and developing Kaplan, Inc. Other companies such as McClatchy Co. (MNI) have supplemented the income generated from smaller news-organizations by acquiring shares in lucrative digital assets such as CareerBuilder or Wanderful Media – which owns digital shopping platforms.
However, The Boston Globe transaction clearly represents the re-emergence of locally owned newspapers, which seems an odd anachronism in an age where the world seems to be getting smaller and smaller. Warren Buffett recently purchased his hometown newspaper, The Omaha World-Herald. Buffett is hardly known as a sentimental investor, saying of the deal "I wouldn't do this if I thought this was doomed to some sort of extinction."
We decided to find more publicly traded stocks that currently have newspaper holdings. Some of the companies are major conglomorates who own nationally familiar titles: such as The New York Times Company and Gannett Co. (GCI), while others are local media companies.
How will the balance in the news room continue to shift? Use the list below to begin your own analysis.
Click on the image below to see sales over time. Quarterly sales data sourced from Zacks Investment Research.
2. Gannett Co., Inc. (GCI, Earnings, Analysts, Financials): Operates as a media and marketing solutions company in the United States and internationally. Market cap at $6.01B, most recent closing price at $26.27.
3. The Washington Post Company (WPO, Earnings, Analysts, Financials): Operates as a diversified education and media company in the United States and internationally. Market cap at $4.05B, most recent closing price at $559.95.
4. The E. W. Scripps Company (SSP, Earnings, Analysts, Financials): Operates as a diverse media company with interests in television stations, newspapers, and local news and information Web sites. Market cap at $940.15M, most recent closing price at $16.69.
6. Lee Enterprises Inc. (LEE, Earnings, Analysts, Financials): Provides local news, information, and advertising services primarily in midsize or small markets in the United States. Market cap at $157.03M, most recent closing price at $3.03.
(List compiled by James Dennin. All data sourced from Finviz.)
Analyze These Ideas: Getting Started
- Read descriptions for all companies mentioned
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Dig Deeper: Access Company Snapshots, Charts, Filings
- The New York Times Company(NYT, Chart, Download SEC Filings)
- Gannett Co., Inc.(GCI, Chart, Download SEC Filings)
- The Washington Post Company(WPO, Chart, Download SEC Filings)
- The E. W. Scripps Company(SSP, Chart, Download SEC Filings)
- The McClatchy Company(MNI, Chart, Download SEC Filings)
- Lee Enterprises Inc.(LEE, Chart, Download SEC Filings)
- A. H. Belo Corporation(AHC, Chart, Download SEC Filings)
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