NEW YORK (AP) ¿ The battered shares of newspaper companies got a lift Tuesday after Gannett Co., the biggest publisher in the U.S., predicted third-quarter earnings well above Wall Street's low expectations.
McLean, Va.-based Gannett, which publishes 84 daily newspapers including USA Today and operates 23 television stations, forecast earnings of 25 cents to 31 cents per share, down sharply from 69 cents per share in the same period a year ago as advertising dollars continued to dry up.
Excluding special charges for the cost of restructuring and other items, Gannett projected profit of 39 cents to 42 cents per share. Analysts, whose estimates typically exclude special items, predict income of 28 cents per share, according to a Thomson Reuters survey.
Gannett's stock jumped $1.89, or 19 percent, to $11.87 in afternoon trading. The stock has ranged from $1.85 to $18.13 over the past year.Investors seemed to take Gannett's announcement as a sign that newspapers will be able to keep turning profits for now, as newsprint costs fall and publishers undertake cost cutting moves such as layoffs. Shares of New York Times Co. rose 49 cents, or 6.1 percent, to $8.48. McClatchy Co. was up 24 cents, or 9.6 percent, to $2.74. Lee Enterprises soared $1.04, or 48.6 percent, to $3.18.