A new threat has emerged for the newspaper industry.
Lee Enterprises (NYSE: LEE, Stock Forum) is another way to play the flagging newspaper industry, although it is quickly becoming apparent that the only direction to go is short.
The shares were massacred last week, moving down almost 9% on Friday. Volume jumped up to 1.7 million shares, more than double an average day's activity.
Lee did not have any special news. It is beginning to dawn on industry experts that a projected 5% revenue drop for newspapers this year could move to 10% or 15% as the economy gets worse and classified ads for real estate and cars have all but disappeared.
The newest threat to newspapers is the rising cost of fuel. Oil is used in printing. Add that to the cost of gas for transportation.
Lee fell to $5.94, a 52-week low. That is off a one-year high of $25.18. It is hard to see how things could get worse, but they will.
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