Stock market investments: Rising newsprint costs weigh on Gannett’s earnings

Gannett Co. Inc., New York symbol GCI, reported revenue of $1.33 billion in the three months ended June 26, 2011. That’s down 2.2%, from $1.37 billion a year earlier. The company is seeing lower advertising revenue at its 82 newspapers, including its flagship paper, USA Today. That’s mainly because its 2010 revenue benefited from advertising tied to the U.S. midterm elections. However, the company’s revenue from its digital operations, such as CareerBuilder.com and newspaper web sites, rose 12.6% in the quarter. Earnings fell 13.5 %, to $151.5 million, or $0.62 per share, from $175.2 million, or $0.73 per share. The company’s publishing earnings were hurt by a 9.3% increase in newsprint costs. To cut costs, the company announced in June 2011 that it will cut 700 jobs, or 2% of its workers. Gannett is a dividend paying stock. Its annual rate of $0.32 a share yields 2.3%. The company also plans to resume buying back its own shares. Gannett is just one of the U.S. stock market investments we analyze in our Wall Street Stock Forecaster newsletter. You can get the latest issue, along with 5 in-depth Special Reports, access to our weekly Email/Telephone Hotlines (which keep you up to date on our U.S. stock market investments between issues) and much more absolutely FREE when you subscribe now. Click here to get started right away.

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Jim Bates

Jim is an associate editor at TSI Network. He is the lead reporter and analyst for The Successful Investor and Wall Street Stock Forecaster and a member of the Investment Planning Committee. Jim has held the Chartered Financial Analyst designation since 1992 and spent more than a decade at the Financial Post DataGroup before joining TSI Network. He has a Bachelor of Commerce degree from the University of Toronto.

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