Zacks Investment Research downgraded shares of The Washington Post Company (WPO) from NEUTRAL to UNDERPERFORM on October 04, 2012, with a target price of $325.00.
We recently downgraded our recommendation on The Washington Post Company to Underperform following disappointing second-quarter 2012 results. The quarterly earnings came in at $5.38 per share, down 22% from $6.88 earned in the prior-year quarter. The decline reflected slump in the students' enrollment and soft advertising demand. Revenue for the quarter fell 5% to $1,006.9 million, reflecting sluggish performance in the Newspaper Publishing and Education divisions. Newspaper Publishing revenue fell 7%, while print advertising revenue declined 15%. Education division's revenue went down 9%, reflecting a 19% fall in Higher Education revenue, a 4% drop in Test Preparation revenue, and a 6% decline in Kaplan Ventures revenue. Total student enrollment dropped 14% during the quarter. To counter the sluggishness in student enrollment, Kaplan Education division has undertaken a restructuring plan to lower its costs structure in the near future.
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