On Newspaper Stocks (Again)
I’m pessimistic about newspapers. But, that doesn’t mean I’m opposed to buying newspaper stocks. The two most interesting offers from Mr. Market are for Journal Register Company (JRC) and Journal Communications (JRN). Expect a write – up on each soon.
There was a recent piece on Journal Communications over at the Motley Fool. Mr. Simpson thinks JRN should dump its telecom business. I have to agree. In fact, I’d like to go a step further. Why not split the whole thing up? The parts are worth more than the whole. So what if it the company isn’t big? It’s cheap, and the value is in specific local assets that could be run just as well if each business was spun off, or if the different businesses were sold to a few bigger companies. There’s value in JRN. Separating the telecom, TV, radio, and newspaper assets should make that value obvious.
I don’t expect it to happen. For now, the value isn’t obvious. That means it’s a good time to dig into JRN. We might just find a bargain.
On a separate note, most newspaper stocks don’t look insanely cheap if you assume decreasing revenues (which I do). The big names may not be your best bet here.