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On Feb 7, 2013, Zacks Investment Research upgraded The New York Times Company (NYT - Analyst Report), the diversified media conglomerate, to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Estimates for The New York Times Company have shown an uptrend since the company reported fourth-quarter 2013 results.The company posted earnings of 26 cents a share that surpassed the Zacks Consensus Estimate of 16 cents. The quarter reflects favorable response to the digital subscription packages, increase in circulation revenue (excluding the extra week in the fourth quarter of 2012) and effective cost management.

The New York Times Company’s top line of $443.9 million came ahead of the Zacks Consensus Estimate of $440 million. Excluding the extra week in the fourth quarter of 2012, total revenue rose 0.4%, while circulation revenue climbed 2.7%. Management now expects total circulation revenue to jump in the low single digits in the first quarter of 2014, gaining from digital subscription initiatives and increase in print home-delivery price.

The New York Times Company, which competes with Gannett Co. Inc. (GCI - Analyst Report), has been adding diverse revenue streams, which include a pay-and-read model, to make it less vulnerable to the economic conditions. The company is also adapting to the changing face of the multiplatform media universe, which currently includes mobile, social media networks and reader application products in its portfolio. The company has also been offloading its assets to better position itself and focus on core areas.

The better-than-expected results triggered an upward revision in the Zacks Consensus Estimates, as analysts become more constructive on 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 fiscal 2014 and 36.4% to 45 cents a share for fiscal 2015 in the past 7 days.

Other Stocks That Warrant a Look

Other better ranked stocks worth considering include, Tribune Company (TRBAA) holding a Zacks Rank #1 (Strong Buy) and Reed Elsevier plc (RUK - Snapshot Report) carrying a Zacks Rank #2 (Buy).

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