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Nielsen (NLSN) Q1 Earnings Lag Estimates, Revenues Up Y/Y

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Nielsen Holdings reported first-quarter 2021 adjusted earnings of 29 cents per share, which lagged the Zacks Consensus Estimate by 9.4% but surged 81.3% year over year.

Total revenues were $863 million up 2.5% year over year and beat the consensus estimate by 2.4%. On a constant-currency (cc) basis, revenues increased 2.5% year over year.

Markedly, on Mar 5, Nielsen completed the divestiture of the Global Connect business for $2.4 billion in net proceeds, which resulted in a $542-million preliminary gain on sale, net of taxes.

Quarter Details

Audience Measurement revenues increased 2.8% year over year to $632 million. Outcomes/Connect revenues were $231 million, up 1.8% year over year.
 

Nielsen Holdings Plc Price, Consensus and EPS Surprise

Nielsen Holdings Plc Price, Consensus and EPS Surprise

Nielsen Holdings Plc price-consensus-eps-surprise-chart | Nielsen Holdings Plc Quote

 

Adjusted EBITDA was $388 million, up 19% year over year. Adjusted EBITDA margin expanded 620 basis points (bps) to 45%.

Nielsen’s selling, general and administrative expenses were $206 million, increasing 2% year over year.

Operating income was $253 million, up 43% year over year.

Balance Sheet & Cash Flow

As of Mar 31, 2021, cash and cash equivalent balance was $1.19 billion, up from $500 million on Dec 31, 2020.

Moreover, as of Mar 31, 2021, gross debt was $6.75 billion, resulting in net debt (gross debt less cash and cash equivalents) of $5.55 billion and a net debt leverage ratio of 3.77x.

2021 Guidance

For 2021, revenues are expected to increase in the range of 2-3%. Organic revenues are expected to increase in the range of 3.5-4.5%.

Adjusted EBITDA is anticipated in the range of $1.470-$1.490 billion. Meanwhile, adjusted EBITDA margin is expected within 42.25-42.5%.

Further, adjusted earnings are expected between $1.47 and $1.58 per share.

Additionally, Nielsen expects free cash flow in the range of $595-$645 million.

Zacks Rank & Stocks to Consider

Nielsen currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader technology sector include Synaptics (SYNA - Free Report) , Agilent Technologies (A - Free Report) and NVIDIA (NVDA - Free Report) . All the three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Synaptics, Agilent and NVIDIA are set to report their earnings results on May 6, 20 and 26, respectively.

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