The New York Times Company NYT, a diversified media conglomerate, is slated to report fourth-quarter 2015 results on Feb 4. The big question facing investors now is, whether the company will be able to deliver a positive earnings surprise in the quarter to be reported. The New York Times Company continued its earnings beat trend with better-than-expected results in the third quarter of 2015, driven by an increase in digital subscribers and a rise in circulation revenues. With this, the company surpassed earnings expectations for five straight quarters. The average positive surprise over the trailing four quarters comes to 29.7%.
Consensus Estimate Positively Skewed
Analysts believe that the momentum building around the stock is guiding toward another impressive performance. Following better-than-expected third-quarter 2015 results, the Zacks Consensus Estimate portrayed an uptrend, climbing 8.5% and 5.1% to 64 cents and 62 cents for 2015 and 2016, respectively, over the past 90 days. Over the same time frame, the Zacks Consensus Estimate for the fourth quarter displayed positive movement, rising 11.5% to 29 cents, thus instilling confidence among investors about an earnings beat.
Zacks Model Shows Likely Earnings Beat
Our proven model shows that The New York Times Company is likely to beat earnings estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. The Most Accurate estimate stands at 30 cents and the Zacks Consensus Estimate is pegged at 29 cents. So the ensuing +3.45% ESP and the company’s Zacks Rank #3 (Hold) make us reasonably confident of an earnings beat.
Sturdy Fundamentals
The New York Times Company has been adding diverse revenue streams, which include a circulation pricing model and a pay-and-read model for NYTimes.com and the International New York Times, to stay less susceptible to the economic conditions. The company is also adapting to the changing face of the multiplatform media universe, which currently includes incorporating mobile, social media networks and reader application products in its portfolio. Additionally, the company remains focused on launching lower-priced as well as premium subscription-based model to target different masses according to their appetite, and emphasize on online video production and brand extension. These factors make the stock appear promising and a rational choice for investors ahead of its fourth-quarter earnings release.
Stocks Poised to Beat Earnings Estimates
Here are some other companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Time Warner Inc. TWX has an Earnings ESP of +2.00% and a Zacks Rank #2 (Buy).
The Walt Disney Company DIS has an Earnings ESP of +1.38% and a Zacks Rank #3.
Scripps Networks Interactive, Inc. SNI has an Earnings ESP of +1.98% and a Zacks Rank #3.
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