Randomly Noted

My mother’s house is lined with newspapers; she’s an old-school news junkie who still takes scissors to paper to clip out articles of interest to her grandchildren, daughters and sons-in laws – not to mention friends and acquaintances across the globe. But we all know Mom’s kind is rapidly dwindling. Even those of us in the newspaper business find ourselves migrating to paperless news-surfing. Which makes Gannett’s optimistic third-quarter earnings forecast rather interesting. Are revenues of disciplined companies such as Gannett, which have slashed costs to survive the economic and media-industry downturn, about to turn the corner and take off? Or are these firms fated to barely bumble along on the back of continued cost cuts, helped as a few advertisers tiptoe back to print media amid a slow-motion economic recovery? Gannett’s shares soared nearly 20% after it said third-quarter earnings, excluding restructuring charges, would come in above analysts’ estimates. Gannett’s quarterly revenue forecast was disappointing, but investors seemed to focus on the earnings outlook. DJN colleague Nat Worden cited John Miller, an Ariel Investments portfolio manager, as saying the profit forecast signals print and broadcast media are broadly recovering from the recession’s low point. “We think there is more upside here as advertisers return to the market,” Miller said. Personally, I’m skeptical (but always hopeful – it’s my beloved industry, after all!) Yes, advertisers will “return” to print media – but they’ll do so at the weak levels seen 12 to 18 months ago, when the broad-based advertising migration away from print media was getting worse irrespective of the economic climate. People like my mother have been print media’s best friends; unfortunately, folks like Mom are rare.