The Journal Register Company has filed for Chapter 11 bankruptcy protection, becoming the latest in a long and growing line of newspaper publishers to hit the bricks.

The company owns 22 daily newspapers, approximately 300 nondaily publications, and 239 websites related to its print publications. The company's publications include The New Haven Register and The Trentonian. The bankruptcy filing lists assets of approximately $596 million and liabilities of about $737 million.

Journal Register (NYSE: JRC) may be the first large, listed newspaper company to go into Chapter 11. With falling revenue and high debt, the company, which publishes a number of papers including the New Haven Register, hired Lazard as it faces delisting from the New York Stock Exchange.

JRC has been the most likely chain to hit trouble for some time. It bought a number of papers in Michigan four years ago and the deep trouble in the economy there has bedeviled the parent company. According to The New York Times, "If the company were to seek bankruptcy protection, as analysts said was possible, it would be a first in recent memory for a publicly traded newspaper company, John Morton, a longtime newspaper analyst, said."

The company's 10-K shows that revenue in 2007 dropped to $463 million from $507 million the year before. Industry analysts believe that ad revenue across all newspapers in the U.S. will drop another 8% this year.

Journal Register operating income before write-offs was $63 million in 2007, but interest expense was $41 million, leaving almost no margin for a further drop. The company has $625 million in debt.

The newspaper industry is dying more quickly now and there will be other defaults in the next year or two. Large chains like McClatchy (NYSE: MNI) face severe debt problems. Its lenders may end up owning the company.

Douglas A. McIntyre is an editor at 247wallst.com.

In the fourth quarter, newspaper revenue dropped 10%, including revenue from online enterprises.

According to The Wall Street Journal, "Ad spending at newspapers and their Web sites totaled $12.6 billion in the December quarter, compared with $14 billion in the final three months of 2006." Online spending was only 7% of the total.

Two companies may be facing forced sales of some of their properties or even outright liquidations. The company in the most trouble is Journal Register (NYSE:JRC). The firm's share price is at $.55 and has been slightly lower. Two years ago, it traded above $12. Falling revenue this year could cause the company to miss payments on its debt. In the fourth quarter of last year, the company has about $9 million in operating income before a non-cash write-off. Its debt service was also $9 million. Revenue is likely to be down more again this year.

The other company in real trouble is the nation's third-largest newspaper operator, McClatchy (NYSE:MNI). The operator bought rival Knight-Ridder and took on huge debt in the process. McClatchy trades just above $10, down from $50 less than two years ago. The company's revenue fell almost 12% in February. McClatchy recently wrote off almost $1.5 billion due to the falling value of its assets. Both Moody's and Fitch have either cut the firm's ratings or put it on credit review.

Just a year ago, it would have been unusual to find investors who thought a large newspaper company would go Chapter 11. This year, it will almost certainly happen.

Douglas A. McIntyre is an editor at 247wallst.com.

A collection of widely traded stocks making 52-week lows often shows sentiment for which industries and investing themes are out of favor.

Some of last week's lows:

Level 3 Communications (NASDAQ: LVLT): The company has one of the largest data and voice networks in the country. But pricing pressure on bandwidth costs and trouble integrating acquisitions did a tremendous amount of damage to the shares when the firm announced third quarter numbers. The stock traded as low as $2.90, down from a 52-week high of $6.80. But, LVLT's real sin is the amount of debt it carries -- almost $7.4 billion. The current market hates balance sheets that indicate too much borrowing.

eBay (NASDAQ: EBAY) is opening a free classified website, not unlike the services offered by Craigslist. The site, called Kijiji has been available overseas. It will now be set up to operate in 220 cities and all 50 states in the U.S. according to The Wall Street Journal. The auction company is vague about how the property will eventually make money.

The new classified site is not good news for newspaper companies like The New York Times (NYSE: NYT) and Journal Register (NYSE: JRC). Shares in these firms have already dropped by as much as half over the last two years as advertising has moved from print to the internet. The availability of auto, real estate, and job classifieds online has been particularly damaging. Most sites like Realtor.com and Monster (NASDAQ: MNST) charge for their services.

The presence of a large, free classified website may pull dollars from some paid online sites, but the companies that cannot afford any more attrition are the ones that still have to support a large editorial staff and printing operations.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Billionaire Sam Zell seemed to like the idea of owning part of the Tribune Company (NYSE:TRB), for a few minutes at least. Other billionaires, like Eli Broad and Ron Burkle, were interested in buying only some of its newspapers. Private equity interests have approached the company about its TV stations.

Now the company is facing the March 31 deadline it set for bids and it appears that no one wants to pony up, at least not at a price much north of where the company currently trades.

That is very bad news for TRB shareholders. Because Wall Street has been hoping for a big bid, Tribune shares are only a few percentage points below where they traded a year ago. Similar companies like The New York Times Company (NYSE:NYT), McClatchy Company Holding (NYSE:MNI), and Journal Register Co. (NYSE:JRC) are off much more. McClatchy shares declined 35% over the period and stock in Journal Register is down 45%.

All of this means that when the March 31 deadline passes, Tribune shares could begin to correct and it would not be a shock if that correction takes that stock down 20% -- at least if investors look at the performance of similar companies.

The Tribune Company needs to find another billionaire.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Most Noteworthy: On an expected light trading day after Thanksgiving, Palm Harbor (PHHM) and Vicor Corp. (VICR) top today's list of downgrades.

• Palm Harbor Homes, Inc. (NASDAQ:PHHM) and Vicor Corp. (NASDAQ:VICR) were downgraded at Matrix USA due to valuation and the slowing demand for housing, Palm Harbor was downgraded to Hold from Buy and Vicor was downgraded to Sell from Hold.

Other Downgrades:

• Air France-KLM ADS (NYSE:AKH) was downgraded to Hold from Buy at Citigroup after shares were up in overseas trading after the company confirmed it was in merger talks with Alitalia.
• Journal Register Company (NYSE:JRC) was downgraded at Matrix USA to Sell from Hold due to the soft demand for print advertising and a decrease in circulation.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).