Dividend.com: Gannett Grounded

S&P Lowers Gannett Rating to Junk

Shares of Gannett(GCI Quote) were down nearly 20% in early trading after Standard & Poor's cut the newspaper company's corporate credit rating to junk status.

S&P maintains the lowered rating is resulting from a worsening pace of expected decline in advertising spending in both Gannett's newspaper publishing and broadcasting businesses, which is due to deteriorating levels of economic activity in the U.S. and the U.K.

The company just recently cut its quarterly dividend payout by 90% to 4 cents per share.

We have avoided shares of Gannett since our early June coverage began, when shares were trading at $27.75. The company has a dividend yield of 5.48%, based on last night's closing stock price of $2.92. We would look elsewhere for a better investment opportunity.

Gannett is not recommended at this time, holding a Dividend.com rating of 2.5 out of 5 stars.

Online Education Firms on the Move

Shares of online education firms were on the move this morning after a Morgan Stanley call on the sector.

Shares of ITT Educational Services(ESI Quote) were up 2% in early trading after Morgan Stanley raised the stock to an overweight from equal-weight, citing an attractive valuation. The stock has technical support at the $90 level. If today's rally can pick up steam, we see overhead resistance around the $118 to $120 levels.

Shares of Career Education(CECO Quote) were down 3% in early trading, after Morgan Stanley downgraded it to an underweight from equal-weight rating, citing the stock's recent run-up. The stock has technical support around the $12 to $14 price area. If the stock can resume its previous rebound, we see overhead resistance around the $27 level.