I’ll admit to being one of those people who see newspaper stocks prices getting pummeled, and wonder whether “the street” could be overreacting to the drumbeat of bad news.

Turns out some people think the bad news isn’t nearly over. In a sobering analysis from Morningstar titled The Market’s Most Overvalued Stocks analyst Matthew Coffina looks at the huge declines at Gannett, Lee, NYTimes, GateHouse and McClatchy this year, and predicts even worse times ahead:

Newspapers have high fixed costs, like journalists’ salaries for reporting. It costs the same to produce a newspaper’s content whether it has a readership of 1 person or 1 million people. That gives newspapers a high degree of operating leverage: As revenues grow, operating profit grows even faster. Unfortunately, the reverse also holds true. As we expect newspaper revenues to steadily shrink in the coming years, these businesses should feel a disproportionate effect on their bottom lines.