Bob, I would love to see this bankruptcy predictor formula too. I tend to be very conservative when it comes to bankruptcy candidates - I don't go near them. I'd be interested in why this one screens so well with me and Twister and so bad with that formula.
You are onto something with the CEO's "pennywise and pound foolish" cost cutting. The guy is quite a character. He may indeed reuse toilet paper. While I have no sense that he is overpaying for acquisitions, I have no doubt the guy pisses people off at the papers he acquires then guts. And I got the sense when I read the Yahoo thread that its the same five ex-employees griping over and over again. He's also got a CFO who is much more conservative and very smart. I think she and the majority owner (Warberg Pincus) will keep the CEO from doing anything too stupid. So far, though, I have a hard time questioning any move he's made. But I agree with you, it is a concern to keep in mind and bring to the attention of anybody looking at the stock.
Regarding the internet, JRC's papers have internet sites, and the company claims their internet business is profitable. They're going into the internet, I believe, to play defense - just in case it becomes an issue they would be the natural one to take that market too because it is tied to the same advertisers and the same content. The risk to a good local paper from the internet, if there is one, is that they fall asleep at the wheel and somebody gets in in front of them.
JJC |
