New York Times shares plunge on ratings concerns (May cut dividend - Dinosaur Media DeathWatch™)

Business Week ^ | August 12, 2008 | Staff

[abb]

New York Times Co. shares slumped Tuesday after an analyst suggested in a media report that the company may need to cut its dividend to avoid a "junk" credit rating.

The newspaper publisher's stock dropped 72 cents, or 5 percent, to $13.37 in afternoon trading. In the past year it has ranged from $12.08 to $22.95.

Last year, the company raised its quarterly dividend 31 percent to 23 cents, which costs it more than $100 million a year in payments to shareholders.

New York Times Co. has seen revenue contract in recent quarters, which crimps cash available for operations and payments. That led Moody's Investors Service to say it may cut the company's credit ratings if operating metrics do not approve.

Earlier Tuesday, Bloomberg quoted a credit analyst with Moody's Investors Service saying the company may need to preserve cash -- potentially by lowering the dividend -- to avoid having its credit rating slashed.

Ratings indicate a company's ability to repay debt and are used by lenders to set the terms of borrowing. Lower ratings mean more expensive credit for a company.

Two weeks ago, Moody's changed the company's rating outlook to "Negative" from "Stable" on concerns about slipping advertising sales. Moody's said the lower ratings outlook reflects worries that the Gray Lady's ad revenue could slip further.

"The New York Times' first-half 2008 operating performance is in the range Moody's anticipated, but there is increasing risk that earnings in the second half of 2008 and in 2009 could fall below prior expectations," Moody's said.

The ratings agency held its senior unsecured Prime-3 commercial paper ratings for the company steady at "Baa3," the lowest investment-grade rating.

The New York Times Co. did not immediately return calls seeking comment.

[abb]

Tuesday afternoon good news.

[abb]

ping

[nckerr]

Just think if they were fair and balanced, there readership[ would grow by 50% easily.

[abb]

http://www.bloomberg.com/apps/news?pid=20601087&sid=aLXAkzjK.H9w&refer=home
New York Times May Need Dividend Cut to Avoid Junk

http://www.portfolio.com/views/blogs/mixed-media/2008/08/12/nyt-dilemma-cut-dividend-or-get-junked
‘NYT’ Dilemma: Cut Dividend or Get Junked

[Da Coyote]

This group O’clowns cannot go bankrupt soon enough. I’m lovin’ it!

[y6162]

hey pinch..nah nah nah...nah nah nah nah..hey hey hey ..goodbye...

[andyandval]

[Sgt_Schultze]

All the news that’s $h!t, we print.

[Right_Wing_Madman]

Dear Dad,

The family fortune is almost gone. Please send more money.

Love,
Pinch

[Enchante]

HA HA.... once they slash their dividends then all the parasites in “the family” who live off their dividends may finally realize that a far-left politically correct bozo like Pinch is just the guy to run the family business into the dirt.

It will be too late to save the Titanic, but they can all get together for some more family reunions to sing and dance to “We are Family” (reportedly their favorite song at Sulzberger family reunions)

[okie01]

If I am not mistaken, dividends from the New York are virtually the only source of income for the entire Sulzberger family.

Wonder how Pinch is going to be received at the next family picnic...???

[andyandval]

[abb]

http://www.mediapost.com/publications/?fa=Articles.showArticleHomePage&art_aid=88342
Mags: The Hits Just Keep On Coming

http://www.medialifemagazine.com/artman2/publish/Magazines_22/Magazines_take_a_fall_at_the_newsstand.asp
Magazines take
a fall at the newsstand

http://www.observer.com/2008/media/magazines-sales-down-6-3-percent
Magazine Sales Down 6.3 Percent; People, In Style Actually Up

http://www.thestreet.com/p/_rmhpta/rmoney/media/10432580.html
Ad-Based Media Companies’ Outlook Grows Darker

[Sigurdrifta]

For comparison, what does the WSJ look like (I suspect a lot better)?

[abb]

http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003837977
E.W. Scripps Takes Huge Goodwill Charge, Changes Q2 Results to Loss

http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003837974
Two Maine Papers to Eliminate 20 Positions

http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003838076
Top Journos Criticize, Defend Edwards Affair Coverage
John Edwards

http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003837978
Reporter Reveals How Buyout/Layoff Fears Affect Her Kids

http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003838180
NYT Co. Shares Slip Over ‘Junk’ Concerns

[conservatism_IS_compassion]

Just think if they were fair and balanced, their readership would grow by 50% easily.

They cannot; it would run counter to the very reason for the existence of "objective" journalism. Which is to create a single voice speaking to the entire country. That is what the Associated Press is.

[bert]

Do I see good news? There seems to be an uptick for two days

[abb]

Their dividend payout rate is 7%. There’s no way on Earth they can continue that.

[bert]

It’s comical. They are going to leave a bunch of folks holding and empty bag after they have looted the company.

[PGR88]

SELL it short! It’s probably going to zero.