Weekly Media Stocks Roundup: Possible Playboy Purchase, Gannett Gunned Down

It was a big week of falling prices for media stocks this week as second-quarter earnings reports began flooding the stock market. Over the past five days, the S&P 500 lost 1.2% 1065, and media stocks took an even harder tumble. One exception: The biggest event of the week in terms of price action took place at Playboy Enterprises, whose shares skyrocketed 36% to $5.37 as Playboy founder Hugh Hefner and Penthouse publisher and FriendFinder Networks CEO Marc Bell entered into a bidding war over the company. Hefner had earlier in the week issued a bid to take Playboy private; his offer valued the company at $185 million. Then on Thursday, Bell lobbed a $210-million takeout offer at shareholders. As if that weren't exciting enough, USA Today publisher Gannett (GCI) on Friday busted out the first media-sector earnings report for the second quarter. Adjusted profit jumped 36% year over year to $146.5 million, while operating revenue declined slightly to $1.37 billion. The company also announced a deal with Yahoo to team up on local advertising sales. Even though the results exceeded Wall Street's expectations, the stock got bludgeoned this week, losing 9.1% to $13.50 -- thanks in part to management's uncertainty about when its revenue declines would finally cease. Weekly stock results for The Washington Post Co. (WPO), News Corp. (NWS) and more after the jump. The saga of The Washington Post Co.'s sale of troubled magazine Newsweek continued. Sidney Harman, a Newsweek bidder, told the New York Post's Keith Kelly that his wife's political career would not exert undue influence on his stewardship of the magazine. A politician running for Jane Harman's congressional seat in California had previously published an open letter to Newsweek managing editor Jon Meacham addressing a potential conflict should the magazine end up in Harman's hands. Meanwhile, the Post Co.'s flagship paper this week announced a partnership with Bloomberg to revamp its online business section. In another online move, the Post Co. bought news aggregator iCurrent. Terms weren't disclosed, but pundits estimated the value of the deal at $5 million. In a move that was unlikely to move the stock but is nonetheless fun to discuss, Newsweek Tumblr editor Mark Coatney announced his impending departure from the magazine to work at Tumblr. Shares in The Washington Post Co. slipped 0.8% to $425.90. Time Warner (TWX) this week announced the expiration of its offer to buy back some of its outstanding debt. The company said it would take a pretax charge of $290 million in the third quarter because of the money it spent on the purchase. Its Time Inc. magazine business, meanwhile, reached a tentative agreement with its union employees Friday. Shares dropped 2.2% to $29.53. Magazine giant Meredith Corp. (MDP) announced that it had completed a purchase of mobile marketing specialist The Hyperfactory. Shares fell 3.6% to $30.57. More media stock results: • The New York Times Co. (NYT): Down 2.3% at $8.80 • News Corp. (NWS): Down 2.1% at $14.14 • Media General (MEG): Up 2.6% at $9.60 • A. H. Belo (AHC): Down 3.1% at $6.56

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Weekly Media Stocks Roundup: Possible Playboy Purchase, Gannett Gunned Down

Mike Taylor

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