In the face of News Corp. announcing profits fell 70 percent for the quarter that ended March 31, chairman Rupert Murdoch is cautiously optimistically about his papers, even though his rags, which include the Wall Street Journal, New York Post and Aussie and British periodicals, have dipped 28 percent in revenue.
Murdoch has said that his UK newspapers may lose money “for a year or three”, but will emerge from the recession stronger and with bigger market share.
Murdoch’s gut may not be correct, but Wall Street is showing signs of agreeing with him recently, giving some out-of-nowhere love to bottomed-out newspaper stocks. The McClatchy Company (Miami Herald) stock has climbed 35 percent over the past month, Lee Enterprises (St. Louis Post-Dispatch and your humble blogger’s employer, the Arizona Daily Star) topped the $1 mark for the first time since November 2008 and Gannett Company (USA Today) is riding a weeklong streak of price hikes.
The reason for the increase? Visionary traders are predicting that everyone will eventually tire of the Internet and go back to waiting for their news until the next day.