Posted on 08/12/2008 1:40:02 PM PDT by 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.
(Excerpt) Read more at businessweek.com ...
It’s about time.
Next year’s results will only be worse.
http://www.tellzell.com/2008/08/doing-numbers.html
Doing the Numbers
Any broker making that stock purchase ought to be sued for malpractice.
Love to see this old gray toothless crack whore do her last 99 cent trick outside the Lincoln Tunnel, and then disappear.
I haven't seen any BS challenged by MSM best journalists.
The ugly (or beautiful) fact of the matter is that the dividend now exceeds earnings. If they don't cut the dividend, the corporation will have to shed assets to generate sufficient cash to meet debt service and make the payout to shareholders; if they cut the dividend, all the trust fund babies whose capitalist grandfathers actually generated wealth will have to get jobs.
Life can be so unfair.
From one of the stories:
“Finally, after they overheard snippets of my phone conversation with their dad, I told them a little. I struggled to be honest”
Yea, it is quite a struggle when you don’t do it very often.
Why couldn’t they just leave the class A dividend high and slash the rest. It would;t be ethical or anything, but we are talking the NYT.
Sweeeeeeeeeet
Rush used this clip in his radio show today.
http://transcripts.cnn.com/TRANSCRIPTS/0808/10/rs.01.html
David Carr, let’s pull back the camera a little bit. I mean, this was a story that wasn’t reported at all by the major media. Now it’s all over cable and every place else. What does it say about the old media gatekeepers that this got out, that everybody found out about this, without our participation?
CARR: Well, I was taught when I was a young reporter that it’s news when we say it is. I think that’s still true, it’s news when we say it is. It’s just who “we” is has changed. Members of the public, people with modems, people with cell phones are now producers, editors. They can push and push and push on a story until it ends up being acknowledged by everyone.
KURTZ: Yes. In this case, it certainly took a while.
Thanks to wide Internet availability and 24-hour news channels, people can get the news far faster than any printed newspaper in the USA. As such, by the time we actually get the paper the news in the paper may already be out of date. And it's going to get worse as people with EVDO-enabled cellphones (like those from Sprint and Verizon Wireless) and HSDPA 3G cellphones (like those from AT&T and T-Mobile) can get the latest news (including streaming video!) just by turning on their cellphone.
Did you see this?
>>Murdoch Reportedly Considers New York Times Deal: Report<<
http://www.freerepublic.com/focus/news/2073848/posts?page=1
Yes, thanks!
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