How low can INM’s share price go?

Share price now disastrously low and market value has an implied value of just €7m

INM’s various newspaper titles on display

INM’s various newspaper titles on display

 

How’s this for a depressing bellwether for the value of “old media” assets?

The price of Independent News and Media (INM) stock fell as low as 6 cent per share on Monday, before recovering, if that is the correct word, to 7 cent per share. Its share price is at historically, disastrously low levels.

INM’s market value is now barely above €97 million. That’s for the entire group, and this also includes almost €90 million of unencumbered cash on the balance sheet.

To put that in perspective: the debt-free company that is the biggest newspaper publisher in the State has, according to its stock market valuation, an implied value of €7 million for its equity, once you exclude the contents of its piggy bank.

That is a sobering valuation for the assets of a company that owns four national newspapers, a clutch of regionals and a nascent digital business. For the price of INM’s equity, you could only pay Alexis Sanchez’s wages at Manchester United for about four months.

It is perhaps unfair to single out INM for attention: it just happens to be the only publicly listed newspaper group in the State, opening it up to a special form of scrutiny.

Still, there does seem to be an especially heavy drag on INM’s share price. Two straight years of corporate governance scandals and a share register dominated by the two of the richest men in Ireland – Denis O’Brien and Dermot Desmond – appear to be weighing heavily on its market position.

How low could its share price go? Not much more, surely. In the world of so-called penny stocks, 6 to 7 cent has to be somewhere near the bottom.

But it says much about the state of the traditional Irish media market that its biggest player can be worth so little.

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