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Thursday, November 03, 2005

Regarding Knight-Ridder "This is a falling knife"

The credit market is making its judgment about Knight-Ridder. This, from a Reuters report:

Jake Newman, analyst at CreditSights in New York, maintained his "underweight" recommendation on Knight Ridder, adding it is impossible to predict how much debt a buyer might add to the company's balance sheet.

"This a falling knife," Newman said, which means it is difficult if not impossible to know when to jump in and go long this credit.

In the bond market an "underweight" recommendation is roughly comparable to "sell" in other markets

Editor & Publisher reports that Knight-Ridder issued its first statement about the quickly progressing events of the past week. That statement, read by Knight-Ridder's Polk Laffoon IV, was all of two sentences.
... he [Laffoon] said that the "board takes its fiduciary duties seriously and will respond in due course."
He did not confirm reports that the company had retained an investment bank to explore strategic options.

It would be nice if the News Sentinel would give this story a higher profile than a few gray paragraphs at the bottom of the business briefs. And they wonder why they're losing readers.
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