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LAKE BUSINESS: Publisher leaves Lake Sun Publications
CAMDENTON, Mo. -- The publisher of Lake Sun Publications has left the building. Jules Molinda parted ways with the newspaper and parent company Gatehouse Media on Tuesday.
Gatehouse Media (GHS) owns Lake Sun Publications, the WestSide Star, the Lake Focus, Lake Lifestyles magazine, Vacation News and an assortment of other publications in the lake area.
GHS publishes about 100 daily newspapers, as well as weeklies and shoppers, that reach about 10 million readers in 20 states. It also operates about 250 websites.
After going public at a per-share price of around $16 in 2006, GHS on Wednesday closed at $1.02 and has traded recently as low as $.82. The NYSE has halted floor trading of the stock. To return to the floor the stock must trade over $1.10 for an entire day. However, if the stock were to trade under $1 for 30 consecutive days, it could be delisted.
Last week after GHS tanked over 20 percent, Morningstar released a trenchant report stating that shares "could be worthless."
"Because of the company's exposure to a challenging advertising environment, a debt-heavy balance sheet, and declining cash flows, we think the equity shares could be worthless," stock analyst Tom Corbett wrote.
Morningstar said GHS runs the risk of violating covenants on its debt. "Should that happen, its debt could become due immediately, resulting in a possible liquidation scenario," Corbett wrote.
The S&P Star Report disagrees giving GHS a 12-month target of $1.50.
Earlier this year GHS cut its dividend by 50 percent to preserve liquidity, to buy back shares and make acquisitions.
Gatehouse is scheduled to report earnings on Aug. 11, 2008.
On the Web:
http://gatehousemedia.com
Subscribe To Lake AlertsGatehouse Media (GHS) owns Lake Sun Publications, the WestSide Star, the Lake Focus, Lake Lifestyles magazine, Vacation News and an assortment of other publications in the lake area.
GHS publishes about 100 daily newspapers, as well as weeklies and shoppers, that reach about 10 million readers in 20 states. It also operates about 250 websites.
After going public at a per-share price of around $16 in 2006, GHS on Wednesday closed at $1.02 and has traded recently as low as $.82. The NYSE has halted floor trading of the stock. To return to the floor the stock must trade over $1.10 for an entire day. However, if the stock were to trade under $1 for 30 consecutive days, it could be delisted.
Last week after GHS tanked over 20 percent, Morningstar released a trenchant report stating that shares "could be worthless."
"Because of the company's exposure to a challenging advertising environment, a debt-heavy balance sheet, and declining cash flows, we think the equity shares could be worthless," stock analyst Tom Corbett wrote.
Morningstar said GHS runs the risk of violating covenants on its debt. "Should that happen, its debt could become due immediately, resulting in a possible liquidation scenario," Corbett wrote.
The S&P Star Report disagrees giving GHS a 12-month target of $1.50.
Earlier this year GHS cut its dividend by 50 percent to preserve liquidity, to buy back shares and make acquisitions.
Gatehouse is scheduled to report earnings on Aug. 11, 2008.
On the Web:
http://gatehousemedia.com
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