Industry Stocks Up for Six Months

The Publishers Weekly Stock Index rose 9.5% in the first six months of 2011, beating the 7.3% increase posted by the Dow Jones Industrial Average. The increase came despite the Borders Group bankruptcy, which has made the stock of that company virtually worthless; it stopped trading on the New York Stock Exchange in February when it was selling at 23 cents per share. Two of Borders's competitors found their share price under assault in the six-month period as well. Books-A-Million's stock plunged 40.7% in the first half of 2011 as the retailer posted a poor first quarter and said it expected a difficult second quarter. Hastings Entertainment also had a disappointing first quarter as higher gas prices and a weak economy slowed sales.

The country's two largest booksellers, Amazon and Barnes & Noble, had good gains in the six-month period, but for different reasons. Amazon had another blow-out first quarter, and although some analysts are worried about the e-tailer's spending, Amazon forecasts solid sales gains for the year. B&N's stock enjoyed a large bounce after John Malone's $17 per share bid, running as high as $21.06 per share before falling back to below Malone's offer at the end of the month as the B&N committee reviewing the offer has given no indication when it might decide on it. The biggest winner in the six months was Simon & Schuster's parent company, CBS, whose stock price nearly doubled in the period, driven largely by good results in its entertainment and broadcasting divisions. Pearson was the best performing publishing stock. On the manufacturing side, industry leader Donnelley's stock rose 12.2%, while the smaller Courier Corp. saw its stock price fall 28.8%.

Industry Stocks: January-June 2011