A second-half rally helped to limit the decline of the Publishers Weekly Stock Index to 4% in 2020, as four of the seven companies on the PWSI managed to post an increase in their stock prices compared to the beginning of the year. At the end of June 30, before the economy began to improve from the depths of the Covid-19-induced crash in the spring, the PWSI was down nearly 20% from the beginning of the year.
The Dow Jones Industrial Average had a 7.2% increase in the year.
John Wiley and Houghton Mifflin Harcourt—two of the three publishers that had declines in their stock price in the year—saw improvement in their share prices since the middle of 2020. A sharp rise in earnings in the quarter ended in October gave Wiley’s stock price a boost late in the year. HMH’s stock price has gradually risen since early October, when the company announced it was restructuring the publisher to become a “pure-play technology learning company,” a move which led to the elimination of 525 jobs and the announcement that the company will sell its trade publishing business.
Scholastic’s stock price fell 35% in the year, after being down 22.1% through June. The company was hit by a steep drop in school book fair revenue, which has negatively affected its overall sales and earnings. Domestic book fair revenue fell 79% in the quarter ended Nov.31, 2020, compared to a year ago, as schools drastically reduced the number of fairs they held. Total Scholastic revenue declined 32%, to $406.2 million, in the quarter, and operating income fell 54%, to $48.8 million.
Educational Development Corp had the best performing stock on the PWSI, with its share price jumping more than 148% in the year. After a slow start following the outbreak of the Covid-19 pandemic, sales and earnings shot up at the company, fueled by the growing demand for educational materials from parents as well as a significant jump in the number of home-based sales reps selling the EDC line.
While the book publishing industry in general has struggled to win the favor of investors, one company has become a Wall Street favorite. Amazon’s stock price soared 76% in 2020, finishing the year at $3,256.93 per share.
