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Factors Setting the Tone for NY Times (NYT) in Q2 Earnings
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The New York Times Company (NYT - Free Report) is expected to report second-quarter 2018 results on Jul 26. In the trailing four quarters, it has outperformed the Zacks Consensus Estimate by an average of 31.6%. In the last reported quarter, this diversified media conglomerate delivered a positive earnings surprise of 13.3%. Consequently, investors are keeping their fingers crossed and hoping that the company surpasses earnings estimate even this time.
How are Estimates Faring?
After registering a bottom-line increase of 70% in the first quarter of 2018, The New York Times Company is likely to record year-over-year decline of 22.2% in the second quarter. This is quite evident from the Zacks Consensus Estimate for the quarter under review, which is pegged at 14 cents compared with 18 cents reported in the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 60 days but witnessed a decline of 3 cents in the past 90 days.
Analysts polled by Zacks now project revenues of $411 million, up roughly 1% from the year-ago quarter. If all goes well, this may be the third straight quarter of top-line beat for the company. We note that total revenue of this NY-based company had increased 3.8% in the last reported quarter.
Let’s delve deeper and find out the factors impacting the results.
Factors Holding Key to NY Times’ Performance
The New York Times Company has been realigning cost structure and streamlining operations to increase efficiencies. It has offloaded assets that bear no direct relation with the core operations in order to concentrate on online activities. The company is fast acclimatizing to the changing face of the multiplatform media universe and has already included mobile and reader application products in its portfolio.
The company notified that the number of paid digital subscribers reached 2,783,000 at the end of the first quarter – rising 139,000 sequentially and 25.5% year over year. Subscription revenue grew 7.5% to $260.6 million, primarily due to increase in the number of subscriptions to the digital-only products. Revenue from digital-only subscriptions products surged 25.8% to $95.4 million. Management had earlier guided that total subscription revenue in the second quarter of 2018 is likely to increase in the mid-single digits.
Apart from gearing up to become an optimum destination for news and information, The New York Times Company is also focusing on service journalism with verticals like Cooking, Watching and Well. In this regard, it acquired The Wirecutter and its sister site — The Sweethome — that recommends people about technology gear, home products and other consumer services.
Analysts pointed out that increasing online readership has made the print-advertising model increasingly redundant. We noted that print advertising revenue fell 1.8%, while total advertising revenue declined 3.4% in the first quarter. The New York Times Company had previously highlighted that total advertising revenue in the second quarter is projected to decline in the low-teens.
The New York Times Company Price, Consensus and EPS Surprise
Our proven model does not conclusively show that The New York Times Company is likely to beat estimates this quarter. A stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
IMAX Corporation (IMAX - Free Report) has an Earnings ESP of +1.65% and a Zacks Rank #1.
World Wrestling Entertainment has an Earnings ESP of +7.94% and a Zacks Rank of #2.
Viacom has an Earnings ESP of +0.28% and a Zacks Rank of #3.
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Factors Setting the Tone for NY Times (NYT) in Q2 Earnings
The New York Times Company (NYT - Free Report) is expected to report second-quarter 2018 results on Jul 26. In the trailing four quarters, it has outperformed the Zacks Consensus Estimate by an average of 31.6%. In the last reported quarter, this diversified media conglomerate delivered a positive earnings surprise of 13.3%. Consequently, investors are keeping their fingers crossed and hoping that the company surpasses earnings estimate even this time.
How are Estimates Faring?
After registering a bottom-line increase of 70% in the first quarter of 2018, The New York Times Company is likely to record year-over-year decline of 22.2% in the second quarter. This is quite evident from the Zacks Consensus Estimate for the quarter under review, which is pegged at 14 cents compared with 18 cents reported in the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 60 days but witnessed a decline of 3 cents in the past 90 days.
Analysts polled by Zacks now project revenues of $411 million, up roughly 1% from the year-ago quarter. If all goes well, this may be the third straight quarter of top-line beat for the company. We note that total revenue of this NY-based company had increased 3.8% in the last reported quarter.
Let’s delve deeper and find out the factors impacting the results.
Factors Holding Key to NY Times’ Performance
The New York Times Company has been realigning cost structure and streamlining operations to increase efficiencies. It has offloaded assets that bear no direct relation with the core operations in order to concentrate on online activities. The company is fast acclimatizing to the changing face of the multiplatform media universe and has already included mobile and reader application products in its portfolio.
The company notified that the number of paid digital subscribers reached 2,783,000 at the end of the first quarter – rising 139,000 sequentially and 25.5% year over year. Subscription revenue grew 7.5% to $260.6 million, primarily due to increase in the number of subscriptions to the digital-only products. Revenue from digital-only subscriptions products surged 25.8% to $95.4 million. Management had earlier guided that total subscription revenue in the second quarter of 2018 is likely to increase in the mid-single digits.
Apart from gearing up to become an optimum destination for news and information, The New York Times Company is also focusing on service journalism with verticals like Cooking, Watching and Well. In this regard, it acquired The Wirecutter and its sister site — The Sweethome — that recommends people about technology gear, home products and other consumer services.
Analysts pointed out that increasing online readership has made the print-advertising model increasingly redundant. We noted that print advertising revenue fell 1.8%, while total advertising revenue declined 3.4% in the first quarter. The New York Times Company had previously highlighted that total advertising revenue in the second quarter is projected to decline in the low-teens.
The New York Times Company Price, Consensus and EPS Surprise
The New York Times Company Price, Consensus and EPS Surprise | The New York Times Company Quote
What the Zacks Model Unveils?
Our proven model does not conclusively show that The New York Times Company is likely to beat estimates this quarter. A stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The New York Times Company has a Zacks Rank #3 but an Earnings ESP of 0.00%, makes surprise prediction difficult. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks With Favorable Combination
Here are companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
IMAX Corporation (IMAX - Free Report) has an Earnings ESP of +1.65% and a Zacks Rank #1.
World Wrestling Entertainment has an Earnings ESP of +7.94% and a Zacks Rank of #2.
Viacom has an Earnings ESP of +0.28% and a Zacks Rank of #3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>