With its stock down by more than 50% over the past three years and its industry in turmoil, Media General ( MEG) announced this week that it's considering the sale of five broadcast TV stations from its portfolio.

It's going to take more than that to generate any enthusiasm from Wall Street.

Investors want Media General to follow the example set by Belo Corp. ( BLC) and E.W. Scripps ( SSP) and separate its broadcasting business from its sluggish newspapers operations.

"We were an advocate on the restructurings at Belo and Scripps, and we think it would be a worthy endeavor at Media General as well," says Barry Lucas, senior vice president of research at Gabelli & Co. The company's chairman, J. Stewart Bryan III, and his family "would still control both entities, so it's not like they'd be giving up anything. In a restructuring like this, what you do is you create the opportunity to surface some shareholder value that is not currently being recognized."

Gabelli & Co., through an affiliate, owns a 20% stake in Media General's Class A shares, but that gives the firm little sway over the company's governance given its dual-class share structure. Bryan owns about 84% of Media General's Class B shares, which hold rights to elect two-thirds of the company's directors even though they comprise relatively small slice of its market cap.

The setup follows a pattern found throughout the newspaper publishing business, which is under fire as competition from the Internet cuts into revenue and profits. Earlier this year, controlling shareholders at Dow Jones ( DJ) were muscled into selling their publishing empire to Rupert Murdoch's News Corp. ( NWS-A), and the Ochs-Sulzberger family, which controls the New York Times ( NYT), was publicly criticized by its largest outside investor for being unaccountable to shareholders.

More recently, Scripps announced that it will separate its national cable and Internet properties from its local newspapers and broadcast stations to appease shareholders. Belo said it will spin off its newspapers from its broadcasting properties.

Both companies are controlled by families through a dual-class share structure that will remain in place after the restructurings.

Now, investors are clamoring for Media General, which publishes more than 175 newspapers and owns 23 TV stations in the Southeast, to do the same. So far, the company has refused.

"Strategically, our integrated presence in print, broadcast and on the Web allows us to produce better content, deliver a higher-quality product, draw more audience and improve our market position better than we otherwise could," said Media General CEO Marshal Morton on the company's third-quarter earnings conference call.

Media General says there is value created by owning newspapers and TV stations in the same market, a view that is consistent with the restructuring at Scripps, which has opted to keep its local newspapers and broadcasting properties together.

For its part, Belo owns the Dallas Morning News along with a leading TV station in Dallas, but the company is planning to split them up. It's keeping whatever synergies that exist between the properties in place through contractual agreements.

Ethan McAfee, director of research with former Media General shareholder Ramsey Asset Management, says he doesn't believe that substantial synergies between broadcast and newspapers really exist at Media General.

"They can't come up with a number to quantify the synergies, which tells me they really haven't thought about it and this is just their excuse to not do something creative or outside the box," says McAfee.

"Any smart management team would do exactly what Belo did and realize the market is not paying at all for the hybrid strategy of owning both TV and newspapers and seriously consider breaking up the two," he adds. Media General's management team "has been around for ever, and they're not particularly savvy Wall Street people. It's a family-owned business and there was never much pushing for them to actually change anything."

Some of Media General's local media properties that are said to benefit from cross-platform synergies are not in the same city, or even in the same state. The Bristol Courier News in Virginia is a partner with WJHL-TV in Johnson County, Tenn. Media General spokesman Ray Kozakewics points out that they're only 23 miles apart and he says they have a productive relationship.

"They're connected by a fiber-optic cable, and they hold frequent conference calls where they share information and data," says Kozakewics. "Our general philosophy is that you don't have to be in the same city in order to work together closely."

McAfee says that a restructuring could raise Media General's share price to $37 or $38 -- a 31% premium to its current price. His firm recently sold its position in the company after concluding that management's unwillingness to restructure was a barrier to investment returns that could not be surmounted.

"They thought we were just trying to make a quick buck, which is partly true, but we were also trying to get them to wake up to realities," says McAfee. "You need a big, aggressive active shareholder to come in to really pressure them to do the right thing, because I don't think the board is going to move forward on any of this stuff without severe shareholder pressure."

Gabelli's Lucas holds a buy rating on the stock, in part because he sees the company's newspaper assets as a drag on the market's valuation of its TV stations. He hopes that Media General's decision to explore a sale of some of its TV assets will bring that to the fore.

The company is mulling the sale of five local stations in markets including Jacksonville, Fla., and Lexington, Ky. If it could sell the stations for 12 times their cash flow, or a total of $100 million or more, that would signal that the rest of its TV portfolio is trading cheaply, Lucas says.

Meanwhile, the company is exploring strategic options for its 33% stake in SP Newsprint, a recycled newsprint concern whose losses have weighed heavily on Media General's earnings this year.

Selling assets will allow the company to pay down debt, which will boost its bottom line.

"Media General does generate free cash flow, so you do have a debt reduction story going forward," says Lucas. "They have attractive assets in growthier markets in the Southeast, particularly in Florida, where you're getting more people, more eyeballs watching and more potential readers for your properties. That will create more retail stores and more potential advertisers as the housing market stabilizes."

Lucas also credits the company with being aggressive in adapting to the Internet. It's a member of the Yahoo! ( YHOO) newspaper consortium, and it recently acquired Blackdot, a company that combines online gaming with advertising.

"A number of publishers will be closing in on 10% of their advertising revenue this year coming from the Internet," says Lucas. "I would say the Internet is not necessarily a death knell for newspapers. Ink on paper may not necessarily be around forever, but the fact is that these are information content aggregators and how they distribute that content and how they get paid for it is going to change over time.

"In the meantime," he adds, "let's separate out the broadcasting business so we can realize its true potential."