Sky is not falling, says Gary Pruitt

Despite the dizzying turbulence, McClathchy Newspapers CEO Gary Pruitt said he remains bullish on his company and the newspaper industry.

"No, I don't think the sky is falling,'' Pruitt, 50, said in a phone interview. "Certainly newspaper stocks are out of favor on Wall Street. That's happened before, and that will happen again. But we're not going to go away."

At least one Wall Street observer shares his optimism. Credit Suisse's Klim initiated coverage of McClatchy last week at a "neutral" rating, arguing that while the company still faces short-term challenges from depressed real estate markets in California and Florida, its shares "could represent the most compelling deep value play within the newspaper sector."

Klim credited the company with making significant progress in integrating its Knight Ridder properties and paying down debt and said it has improved its newspaper Web sites to generate more online ad revenue. Klim also voiced confidence in McClatchy's management team, which he said "is widely considered to be one of the top operating teams in the business."

Click on the headline to read the full headline interview McClatchy's Fall From Grace by Louis Hau