Is The New York Times Company (NYT), a diversified media conglomerate, part of your portfolio? If not, then this is the right time to zero down on the stock as it looks very promising. Moreover, the underlying factors are capable of carrying the momentum further. The stock attained a Zacks Rank #1 (Strong Buy) on Dec 27, 2014.
The New York Times Company has been witnessing an uptrend in the Zacks Consensus Estimate since the company posted better-than-expected third-quarter 2014 results. The company witnessed an increase in its digital subscription packages and a rise in both circulation and digital advertising revenues during the reported quarter. These completely offset the soft print advertising demand and rise in operating costs.
The New York Times Company posted quarterly earnings of 3 cents a share that fared better than the Zacks Consensus Estimate of a loss of one cent and improved by a couple of cents from the year-ago quarter. In the trailing four quarters, the company has beaten the Zacks Consensus Estimate by an average of 131.3%.
The company’s top line grew 0.8% year over year to $364.7 million, following a decline of 0.6% in the second quarter. Revenue also came in marginally above the Zacks Consensus Estimate of $363 million.
The better-than-expected results triggered an uptrend in the Zacks Consensus Estimate, as analysts become optimistic about the stock’s future performance. This is evident from the movement witnessed in the Zacks Consensus Estimate that increased 7.9% to 41 cents for 2014 and 14.3% to 48 cents a share for 2015 in the past 60 days.
The New York Times Company has been adding diverse revenue streams, such as a pay-and-read model, to make it less vulnerable to economic conditions. The company remains committed to streamline its cost structure, strengthen its balance sheet and rebalance its portfolio. The company is also adapting to the changing face of the multi-platform media universe and has already included mobile and reader application products in its portfolio.
Other publishing companies such as Journal Communications, Inc. (JRN), The E. W. Scripps Co. (SSP) and Gannett Co., Inc. (GCI) are also trying to adapt to different means of revenue generation.
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