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Zacks Industry Outlook Highlights: McClatchy, Gannett, New York Times and New Media Investment Group
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For Immediate Release
Chicago, IL – Feb 14, 2018 – Today, Zacks Equity Research discusses the Industry: Publishing, Part 1, including The McClatchy Company , Gannett Co., Inc. (GCI - Free Report) , The New York Times Company (NYT - Free Report) and New Media Investment Group Inc..
Steadily declining advertising revenues and print readership have emerged as enduring features of the U.S. newspaper publishing industry. Readers’ preference for accessing news online, mostly free, has made the industry’s print-advertising model increasingly irrelevant.
Changing consumer preferences and new technologies have altered the way news is offered and consumed. 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 thus tapping the online video boom to reach their audience.
This has forced the newspaper publishing companies to diversify their revenue base, trim their operations, revamp their print editions and make their digital offerings more compelling. These appear inevitable in the wake of declining print advertising revenues.
The McClatchy Company witnessed an 18.7% drop in print advertising revenues during the third quarter of 2017, preceded by a decline of 15.6% in the second quarter. At Gannett Co., Inc., print advertising and circulation revenues declined 18.7% and 7.6%, respectively, on a same-store basis. The New York Times Company print advertising revenues fell 8.4% during the fourth quarter of 2017.
Newspaper Companies Fast Adapting to Changing Dynamics
Newspaper companies have been remodeling and restructuring themselves to better align with the growing need of marketers and 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 digital advertising agency Excellerate to provide marketing solutions to local and regional advertising clients. The company’s digital-only advertising revenues increased 8.2% in the third quarter of 2017. New Media Investment Group Inc.’s digital revenues increased 11.1% during the third quarter. At Gannett, digital revenues jumped 3.7% on a same store basis, with growth in areas such as mobile, audience extension, digital marketing services and branded content.
Companies are increasingly relying on the pay-and-read model. The New York Times Companystated that the number of paid digital subscribers reached 2,644,000 at the end of the fourth quarter of 2017 – rising 157,000 sequentially and 41.8% year over year. Revenues from digital-only subscriptions products surged 51.2% during the quarter. Management now projects total subscription revenues in the first quarter of 2018 to increase in mid to high-single digits.
The industry has been witnessing increasing consolidation activity. Publishing companies continue to be disciplined buyers of local media assets.
New Media Investment Group has been continuously looking for strategic buyout targets and partnerships. The company acquired certain newspapers and related assets of Morris Publishing Group for $120 million and also teamed up withonline employment marketplace, ZipRecruiter, which is now the exclusive provider of recruitment advertising to all print and online newspapers.
New Media Investment Group also acquired a 20% stake in an opt-in text-based platform, TapOnIt. The platform lets consumers receive offers from local businesses directly on their phones. The company has also entered into an alliance with Houzz, a home improvement and interior design site. The collaboration allows New Media readers to gather information on home renovation and design as well as other local real estate content and homes for sale.
Notably, Gannett has been aggressively expanding its digital presence, as evident from its acquisitions of ReachLocal, Golfweek, SweetIQ and Grateful Ventures. This diversified publishing conglomerate,in October 2015, entered into a deal to acquire Journal Media Group, Inc., theowner of the Milwaukee Journal Sentinel and other newspapers. In April 2016, the company completed the acquisition of all of the remaining shares.
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, Gannett, New York Times and New Media Investment Group
For Immediate Release
Chicago, IL – Feb 14, 2018 – Today, Zacks Equity Research discusses the Industry: Publishing, Part 1, including The McClatchy Company , Gannett Co., Inc. (GCI - Free Report) , The New York Times Company (NYT - Free Report) and New Media Investment Group Inc. .
Industry: Publishing, Part 1
Link: https://www.zacks.com/commentary/149191/publishing-industry-stock-outlook---february-2018
Steadily declining advertising revenues and print readership have emerged as enduring features of the U.S. newspaper publishing industry. Readers’ preference for accessing news online, mostly free, has made the industry’s print-advertising model increasingly irrelevant.
Changing consumer preferences and new technologies have altered the way news is offered and consumed. 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 thus tapping the online video boom to reach their audience.
This has forced the newspaper publishing companies to diversify their revenue base, trim their operations, revamp their print editions and make their digital offerings more compelling. These appear inevitable in the wake of declining print advertising revenues.
The McClatchy Company witnessed an 18.7% drop in print advertising revenues during the third quarter of 2017, preceded by a decline of 15.6% in the second quarter. At Gannett Co., Inc., print advertising and circulation revenues declined 18.7% and 7.6%, respectively, on a same-store basis. The New York Times Company print advertising revenues fell 8.4% during the fourth quarter of 2017.
Newspaper Companies Fast Adapting to Changing Dynamics
Newspaper companies have been remodeling and restructuring themselves to better align with the growing need of marketers and 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 digital advertising agency Excellerate to provide marketing solutions to local and regional advertising clients. The company’s digital-only advertising revenues increased 8.2% in the third quarter of 2017. New Media Investment Group Inc.’s digital revenues increased 11.1% during the third quarter. At Gannett, digital revenues jumped 3.7% on a same store basis, with growth in areas such as mobile, audience extension, digital marketing services and branded content.
Companies are increasingly relying on the pay-and-read model. The New York Times Companystated that the number of paid digital subscribers reached 2,644,000 at the end of the fourth quarter of 2017 – rising 157,000 sequentially and 41.8% year over year. Revenues from digital-only subscriptions products surged 51.2% during the quarter. Management now projects total subscription revenues in the first quarter of 2018 to increase in mid to high-single digits.
The industry has been witnessing increasing consolidation activity. Publishing companies continue to be disciplined buyers of local media assets.
New Media Investment Group has been continuously looking for strategic buyout targets and partnerships. The company acquired certain newspapers and related assets of Morris Publishing Group for $120 million and also teamed up withonline employment marketplace, ZipRecruiter, which is now the exclusive provider of recruitment advertising to all print and online newspapers.
New Media Investment Group also acquired a 20% stake in an opt-in text-based platform, TapOnIt. The platform lets consumers receive offers from local businesses directly on their phones. The company has also entered into an alliance with Houzz, a home improvement and interior design site. The collaboration allows New Media readers to gather information on home renovation and design as well as other local real estate content and homes for sale.
Notably, Gannett has been aggressively expanding its digital presence, as evident from its acquisitions of ReachLocal, Golfweek, SweetIQ and Grateful Ventures. This diversified publishing conglomerate,in October 2015, entered into a deal to acquire Journal Media Group, Inc., theowner of the Milwaukee Journal Sentinel and other newspapers. In April 2016, the company completed the acquisition of all of the remaining shares.
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.