New York Times Spikes on Q3 Report

NEW YORK (TheStreet) -- Shares of the New York Times(NYT Quote) have lagged those of other newspaper companies since the sector began its steady stock-price climb late this past summer. But a better-than-expected earnings report from the company Thursday allowed Times shares to play catch up.

Investors bid up the stock by as much as 18% Thursday. In afternoon trading, Times shares were changing hands at $10.24, up $1.49, or 17%, on volume of 3.5 million shares, nearly double the daily average turnover in the name.

Market players and media watchers were pretty much looking at one thing: advertising revenue. They want to gauge whether this beleaguered business has touched bottom and whether ad buyers are now prepared to increase in any way their spending on space in newspaper pages.

For sentiment to improve, the smallest clippings of evidence will do. In the case of the Times' third-quarter report, that's exactly what the market got. Total ad revenue, the company said, declined 26.9% from a year ago -- an awful figure. But it's a slower rate of decline than what the Times experienced in the first and second quarters of the year, when ad revenue fell by more than 30%.

Gannett(GCI Quote), publisher of the USA Today and metropolitan dailies around the country, reported similar declines in ad sales last week. It said that its print advertising revenue dropped 28.4%, which, as with the Times, was a less severe shrinkage than earlier in the year.

Still, when can the world expect something better than 20-plus percent declines in the core businesses of these once-virile organizations?