Shares of Meredith Corporation (MDP - Analyst Report) recorded a new 52-week high of $47.50 yesterday, before closing at $47.07, and rising approximately 40% year to date.
Based on the current price, Meredith is 12.7% above the Zacks Consensus average analyst price target of $41.75. Moreover, it currently trades at a forward P/E of 16.5x, a 15.9% discount the peer group average of 19.62x. The stock’s long-term EPS growth rate stands healthy at 11.5%.
Meredith is a perfect bet for investors who are seeking both growth and income. The company through its TSR (Total Shareholder Return) strategy intends to boost shareholders value through dividends, share repurchases and strategic investments in business to drive growth.
The company has a strong history of making dividend payouts for 66 consecutive years. Over the last decade, the company has boosted its dividend at an average annualized rate of 16% and raised dividend annually for 20 straight years.
Moreover, Meredith constantly endeavors to explore and add alternative revenue generating channels through acquisitions or strategic alliances. Thereby, the company is attempting to reduce its dependence on conventional advertising.
The company also extended its contract with Wal-Mart Stores Inc. (WMT - Analyst Report) through 2016, which includes an expansion of the Better Homes and Gardens branded home decor and garden program at Wal-Mart stores across the United States and Canada.
Alongside, the company renewed its long-term affiliation agreements with CBS Corporation (CBS - Analyst Report) and News Corp.’s (NWSA - Analyst Report) Fox Broadcasting Co.
Going forward, management’s strategy will be focused upon bolstering advertising revenue, primarily in the digital space, enhancing online consumer transactions, especially magazine subscription orders, focusing on non-advertising dependant activities, such as brand licensing, marketing services and e-Commerce, and attaining operational efficiencies.
Currently, shares of Meredith hold a Zacks Rank #3 (Hold).