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Two Ways To Play: Newspaper Advertising Gets Scooped


Strengthen your portfolio in good times and bad.

According to Bloomberg, the New York Times Company (NYT) said today that advertising revenue at its newspapers and Web sites fell 13% in May. It was the biggest monthly decline this year for the third largest newspaper publisher in the U.S.

For the company, total sales fell 6.6% in May even as circulation revenue increased 1.9%. Weighing on the company were drops in national, retail and classified ads.

The sentiment is in synch with other companies in the sector. Gannett (GCI), which owns USA Today, also said ad sales dropped 14% in the same month. For the quarter ending in March, it was the industry's worst performance on record, according to the Newspaper Association of America.

In today's trading:

NYT fell -2.18% to $16.16.
GCI closed -4.50% to $24.42.

From the Bull Pen: Bulls looking for a related upside play might see one in investment information provider Morningstar (MORN) as the stock may be forming a miniature bullish pennant.

From the Bear Cave: With advertising sales accounting for 98% of all revenues, is Google (GOOG) the next downside play?
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No positions in stocks mentioned.

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