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Zacks Industry Outlook Highlights: McClatchy, New York Times, Gannett and New Media Investment Group
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For Immediate Release
Chicago, IL – October 16, 2017 – Today, Zacks Equity Research discusses the Industry: Publishing, Part 1, including The McClatchy Company (NYSEAMERICAN: – Free Report), TheNew York Times Company (NYSE:(NYT - Free Report) – Free Report), Gannett Co., Inc. (NYSE:(GCI - Free Report) – Free Report) and New Media Investment Group Inc. (NYSE: – Free Report).
The U.S. newspaper publishing industry has long been grappling with sinking advertising revenues, and the global economic slowdown has only worsened the situation. The downturn in the newspaper publishing industry witnessed over the last few years was aggravated by a decline in print readership. More and more readers started opting for online news, thereby making the print-advertising model increasingly irrelevant.
Changing consumer preferences and the advent of new and innovative technologies have been altering the way news is offered and read. Readers now have myriad choices when it comes to collecting and reading articles or news through devices such as netbooks, tablets or other hand-held devices. Advertisers are now tapping the online video boom to reach their audience.
These factors have been weighing on the print industry, as advertisers now get low-cost avenues to reach their target audience more effectively. We believe that an alternative and stable source of revenues is needed to salvage the dwindling print newspaper industry. To deal with the situation, newspaper companies are trimming their operations, resorting to restructuring, revamping their print editions and investing in digital initiatives.
Declining Newspaper Advertising Revenues
Advertising remains a significant source of revenues for the industry that in turn depends on the health of the economy. Macroeconomic factors such as sluggishness in business spending, high unemployment and falling home sales may affect the level of national, retail and classified advertising revenues, as advertisers cut their budget in response to soft economic conditions.
Advertising volumes remain under pressure as advertisers still deter from making any upfront commitment in an economy under recovery. The McClatchy Company (NYSEAMERICAN: – Free Report) witnessed a 15.6% drop in print advertising revenues during the second quarter of 2017, preceded by a decline of 17% in the first quarter. Print advertising revenues fell 10.5% in the second quarter, following a decline of 17.9% in the preceding quarter at The New York Times Company (NYSE:(NYT - Free Report) – Free Report). At Gannett Co., Inc. (NYSE:(GCI - Free Report) – Free Report), print advertising and circulation revenues declined 16.8% and 7.4%, respectively, on a same-store basis.
Newspaper Companies Keeping Up Changing Trends
Newspaper companies have now been remodeling and restructuring themselves to better align with the growing need of marketers, targeting younger people, affluent households and other demographic groups with multiple web and print publications. Publishing companies are adapting to the changing face of the multi-platform media universe, which currently includes Internet, mobile, tablet, social media networks and outdoor video advertising in its portfolio.
McClatchy launched a new digital advertising agency, ‘excellerate,’ to provide marketing solutions to local and regional advertising clients. The company’s digital-only advertising revenues surged 10% in the second quarter of 2017, while total digital advertising revenue fell a marginal 0.9% from the year-ago period. The New York Times Company’s digital advertising revenues jumped 22.5%, while New Media Investment Group Inc.’s (NYSE: – Free Report) digital revenues increased 9% during the second quarter.
Publishing companies have been disciplined buyers of local media assets. New Media Investment Group has been continuously looking for strategic buyouts. The company concluded the acquisition of Harris Enterprises, Inc. in November 2016 and also completed the buyout of the Ohio publishing division of Wooster Republican Printing Company in January 2017.
The company recently entered into an agreement to buy many of the newspapers and related assets from Morris Publishing Group for $120 million and also teamed up with online employment marketplace, ZipRecruiter, which is now the exclusive provider of recruitment advertising to all its print and online newspaper pages.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Industry Outlook Highlights: McClatchy, New York Times, Gannett and New Media Investment Group
For Immediate Release
Chicago, IL – October 16, 2017 – Today, Zacks Equity Research discusses the Industry: Publishing, Part 1, including The McClatchy Company (NYSEAMERICAN: – Free Report), The New York Times Company (NYSE:(NYT - Free Report) – Free Report), Gannett Co., Inc. (NYSE:(GCI - Free Report) – Free Report) and New Media Investment Group Inc. (NYSE: – Free Report).
Industry: Publishing, Part 1
Link: https://www.zacks.com/commentary/132129/publishing-industry-outlook---october-2017
Is Diversification the New Mantra?
The U.S. newspaper publishing industry has long been grappling with sinking advertising revenues, and the global economic slowdown has only worsened the situation. The downturn in the newspaper publishing industry witnessed over the last few years was aggravated by a decline in print readership. More and more readers started opting for online news, thereby making the print-advertising model increasingly irrelevant.
Changing consumer preferences and the advent of new and innovative technologies have been altering the way news is offered and read. Readers now have myriad choices when it comes to collecting and reading articles or news through devices such as netbooks, tablets or other hand-held devices. Advertisers are now tapping the online video boom to reach their audience.
These factors have been weighing on the print industry, as advertisers now get low-cost avenues to reach their target audience more effectively. We believe that an alternative and stable source of revenues is needed to salvage the dwindling print newspaper industry. To deal with the situation, newspaper companies are trimming their operations, resorting to restructuring, revamping their print editions and investing in digital initiatives.
Declining Newspaper Advertising Revenues
Advertising remains a significant source of revenues for the industry that in turn depends on the health of the economy. Macroeconomic factors such as sluggishness in business spending, high unemployment and falling home sales may affect the level of national, retail and classified advertising revenues, as advertisers cut their budget in response to soft economic conditions.
Advertising volumes remain under pressure as advertisers still deter from making any upfront commitment in an economy under recovery. The McClatchy Company (NYSEAMERICAN: – Free Report) witnessed a 15.6% drop in print advertising revenues during the second quarter of 2017, preceded by a decline of 17% in the first quarter. Print advertising revenues fell 10.5% in the second quarter, following a decline of 17.9% in the preceding quarter at The New York Times Company (NYSE:(NYT - Free Report) – Free Report). At Gannett Co., Inc. (NYSE:(GCI - Free Report) – Free Report), print advertising and circulation revenues declined 16.8% and 7.4%, respectively, on a same-store basis.
Newspaper Companies Keeping Up Changing Trends
Newspaper companies have now been remodeling and restructuring themselves to better align with the growing need of marketers, targeting younger people, affluent households and other demographic groups with multiple web and print publications. Publishing companies are adapting to the changing face of the multi-platform media universe, which currently includes Internet, mobile, tablet, social media networks and outdoor video advertising in its portfolio.
McClatchy launched a new digital advertising agency, ‘excellerate,’ to provide marketing solutions to local and regional advertising clients. The company’s digital-only advertising revenues surged 10% in the second quarter of 2017, while total digital advertising revenue fell a marginal 0.9% from the year-ago period. The New York Times Company’s digital advertising revenues jumped 22.5%, while New Media Investment Group Inc.’s (NYSE: – Free Report) digital revenues increased 9% during the second quarter.
Publishing companies have been disciplined buyers of local media assets. New Media Investment Group has been continuously looking for strategic buyouts. The company concluded the acquisition of Harris Enterprises, Inc. in November 2016 and also completed the buyout of the Ohio publishing division of Wooster Republican Printing Company in January 2017.
The company recently entered into an agreement to buy many of the newspapers and related assets from Morris Publishing Group for $120 million and also teamed up with online employment marketplace, ZipRecruiter, which is now the exclusive provider of recruitment advertising to all its print and online newspaper pages.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.