Well, that can't be good...

When your employer shows up on somebody's analysis as at-risk for bankruptcy...

In last week's post I calculated Z scores, an index used to forecast bankruptcy risk, for the New York Times (NYT) and several key competitors, including the Washington Post (WPO), News Corp (NWS), and the McClatchy News Group (MNI) using the 10K and 10Q reports. Since then I did the calculations for four more newspaper publishers, Gannett (GCI), Journal Register (JRE), Lee (LEE), and Scripps (SSP). The results are consistent with the respective business conditions facing each company

NYT WPO NWS MNI GCI SSP LEE JRE Z Score 9/2007
1.835 4.118 2.139 0.812 2.755 4.137 1.282 0.752


News Corp., The Washington Post, Gannett and Scripps all score well above the 1.8 high risk threshold. These companies are diversified communications media companies with a number of high performance segments offsetting the structural decay of their newspaper properties. The other companies in the danger zone are all mainly pure-play newspaper businesses that made the fatal decision to buy out competitors at a false bottom similar to Movie Gallery's bad move.

McClatchy, Lee, The Journal Register and to lesser extent the New York Times should be placed on the watch list.