The Zacks Analyst Blog Highlights: SuperMedia, Dex One, Google, Yelp and
CHICAGO, March 22, 2013
CHICAGO, March 22, 2013 /PRNewswire/ --Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include SuperMedia Inc. (Nasdaq:SPMD),
Dex One Corporation (NYSE:DEXO), Google Inc. (Nasdaq:GOOG), Yelp, Inc.
(NYSE:YELP) and Sprint Nextel Corp. (NYSE:S).
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from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Thursday's Analyst Blog:
Can Yellow Pages Make a Comeback?
SuperMedia Inc. (Nasdaq:SPMD) and Dex One Corporation (NYSE:DEXO) , two of the
nation's largest "yellow page" companies, announced earlier this week that
they have filed for Chapter 11 bankruptcy protection. This is part of a plan
to merge into one entity. According to Dex One's General Counsel Mark W.
Hianik, the merger will result in annual savings of $175 million.
The merger plan, revealed in August 2012, has received support from
shareholders as well as a majority of the company's lenders. As per the
Chapter 11 petition, Dex One has $2.84 billion in assets and $2.79 billion in
SuperMedia has declared assets of $1.4 billion and $1.9 billion of debt.
SuperMedia's Chief Financial Officer has said that the companies will be able
to utilize $1 billion in net operating losses from Dex One to save around $400
million in income taxes in the future.
This is not the first time these companies have filed for bankruptcy. In 2009,
SuperMedia filed, emerging only in December that year, with Dex One following
suit the next month. The single entity formed out of the merger is expected to
exit bankruptcy in 60 days.
What this development draws attention to is the dwindling fortunes of the
yellow pages business. There are several indications that the directory
business is steadily shrinking. With the proliferation of digital media, the
likes of Google Inc. (Nasdaq:GOOG) and Yelp, Inc. (NYSE:YELP) have challenged
the paper directory business in a manner it is finding difficult to combat.
For instance, leisure-related searches, such as restaurant locations, have
moved almost completely online. This has led yellow page companies to invest
more in improving their digital business, through which their customers can
have an online presence.
Additionally, many larger companies have sold or spun off their directories
businesses. In fact, the companies in question, Dex One and SuperMedia were
both formed as a result such moves. Dex One was formed out of the directories
businesses of Sprint Nextel Corp. (NYSE:S) and Qwest Communications, which no
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