Shares of Gannett Co. slumped 4.5% in afternoon trade Monday after FBR & Co. downgraded the broadcast, digital and print media company, citing concerns about valuation and contract renegotiations. Analyst William Bird cut his rating to market perform after being at outperform for the last year and a half. He kept his stock price target at $38, which is just above the seven-year closing high of $37.39 reached on Thursday. "Our outperform thesis was built on [Gannett's] previously wide discount to its sum-of-the-parts valuation. Based on our estimates, the gap has largely closed," Bird wrote in a note to clients. "We also see fundamental factors that could hamper performance: [Wall] Street estimates and valuations do not appear to capture public company costs and large reverse [retransmission] contracts to be renegotiated in 2016 [with CBS] and 2017 [with NBC]." The stock had climbed 12% year to date, while the S&P 500 has gained 1.2%.
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