Industry Stocks Struggled in 2014

Despite another year of strong gains for the stock market, the Publishers Weekly Stock Index fell 13.6% in 2014 (relative to 2013), as only five of the 13 companies on the PWSI had an increase in their share price. The decline follows an extremely bullish 2013, in which the PWSI rose 51% over the previous year. Amazon, whose share price jumped 59% in 2013 to close the year at $398.79, had its stock price fall 22.2% in 2014, finishing the year at $310.35. During the year, investors grew increasingly impatient with the e-tailer’s choice to continue investing in a wide range of areas while posting meager profits.

Amazon’s bookselling rival, Barnes & Noble, saw its stock price rise 55.3% in 2014 over the previous year, the second-best gain among the companies on the PWSI. Investors appear to believe that B&N is close to putting its Nook Media woes behind it, with some sort of separation between Nook and the bookstore business likely to occur in 2015—something investors believe will be a boon to B&N’s core business. Educational Development Corp. had the largest increase in its share price among PWSI companies. The company showed steady revenue gains and improving profitability for much of 2014 despite its much-publicized decision to stop selling through Amazon in February 2012.

Houghton Mifflin Harcourt completed its first full year as a publicly traded company, with its share price up 22.1% in 2014 and ahead 72.5% since the company went public on Nov. 14, 2013. Two other companies that began trading in 2013 did not fare as well. News Corp’s share price fell 15.4% in 2014, after rising 16.6% in 2013 from its $15.29 share price on June 28, 2013, the date it split from its former parent company. Chegg’s share price dropped 18.8% in 2014, after falling 31.9% between Nov. 13, 2013, the day of its initial public offering, and the end of that year.

Stock Watch, 2014