Zacks Industry Outlook Highlights: Gannett, Tribune and New York Times Co.
CHICAGO, May 9, 2013 /PRNewswire/ -- Today, Zacks Equity Research discusses the U.S. Publishing, including Gannett Co. Inc. (NYSE: GCI), Tribune Company (OTC:TRBAA) and The New York Times Company (NYSE: NYT).
A synopsis of today's Industry Outlook is presented below. The full article can be read at
We believe the success of the pay model depends on the accessibility of new articles across the web. Potential customers will be reluctant to shell out a penny if content is available free elsewhere.
OPPORTUNITIES Despite the tough times faced by the publishing industry, there are a number of defensive names in the group that can hold their ground. Companies are radically changing their business models to get in line with industry trends.
Gannett Co. Inc. (NYSE: GCI) is diversifying its business by adding new revenue streams to make it less susceptible to economic uncertainties. The company is also streamlining its cost structure, strengthening its balance sheet and rebalancing its portfolio. Gannett remains well positioned to harness the opportunities of rapidly changing business model such as digitalization in order to keep itself on the growth path.
Gannett posted stronger-than-anticipated first-quarter 2013 results, benefiting largely from its all access content subscription model coupled with sturdy performance of its Broadcasting and Digital segments. The adjusted quarterly earnings came in at 37 cents a share that surpassed the Zacks Consensus Estimate of 34 cents, and rose 8.8% year over year.
Gannett currently holds Zacks Rank #3 (Hold). Another stock in the publishing sector that looks promising is Tribune Company (OTC: TRBAA), which holds a Zacks Rank #1 (Strong Buy).
The newspaper industry continues its struggle with plummeting advertising revenue amid the economic headwinds. Although murmurs about advertisers returning to the market are gaining ground as the economy recovers, the positive effects have yet to be realized.
The current economic upheaval is taking a toll on publishing companies, andThe New York Times Company (NYSE: NYT) is no exception. During first-quarter 2013, total advertising revenue slid 11.2%, whereas print advertising fell 13.3%. Total classified advertising dropped 10.9%.
The company's high dependence on advertising revenue, a derivative of the health of the economy, remains a potential threat. However, the company is repositioning itself for improvement in print and digital media through a new subscription based model. The New York Times Company currently carries a Zacks Rank #4 (Sell).
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SOURCE Zacks Investment Research, Inc.
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