Back to top

Factors Likely to Influence Meredith's (MDP) Q1 Earnings

Read MoreHide Full Article
Meredith Corporation (MDP - Free Report) is slated to release first-quarter fiscal 2019 results on Nov 7. The Zacks Consensus Estimate for the quarter under review is pegged at a loss of 32 cents, against earnings of 69 cents per share reported in the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the past 30 days. The company has been struggling with its dismal bottom-line performance for quite some time now. 
Nevertheless, the Zacks Consensus Estimate for revenues is $747 million, which portrays a significant improvement from $392.8 million recorded in the year-ago period.
Let’s see how things are shaping up prior to this announcement.
Meredith Corporation Price and EPS Surprise
Meredith is gaining from top-line growth, driven by strong performance in all its segments. Going forward, management expects revenues at National Media Group to be $540-$550 million for first-quarter fiscal 2019 and sales at Local Media Group to be $200-$210 million. In fiscal 2019, Meredith projects total revenues of $3-$3.2 billion, up from $2.2 million in fiscal 2018. Also, the company is likely to witness record digital revenues for the National Media Group, backed by, owing to higher traffic.
Further, the company has been actively pursuing strategic acquisitions, such as that of KPLR-TV, to boost growth.  Additionally, the company acquired Time Inc. to create a leading media company. Meredith expects to generate cost synergies of more than $500 million annually in the first two years of the combined firm’s operations. Other notable acquisitions include Turner’s broadcast assets WPCH in Atlanta, Shape magazine and the digital assets of Shape, Natural Health, and Fit Pregnancy brands from American Media Inc. 
The company is focused on restructuring actions. Meredith recently inked a deal to sell its media brand Time to Inc.’s founders. Earlier, the company offloaded Meredith Xcelerated Marketing to Accenture. Furthermore, the company divested its Time Inc. UK and Golf media brands, and announced plans to sell the TIME, Sports Illustrated, Money, Fortune and affiliated media brands. Meredith is also exploring options for the sale of its equity investment in Viant. 
What Does the Zacks Model Say?
Our proven model does not conclusively show that Meredith 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.
Though Meredith carries a Zacks Rank #3, an Earnings ESP of 0.00% makes surprise prediction difficult.
Stocks Poised to Trump Earnings Estimates
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat:
The Hain Celestial Group (HAIN - Free Report) has an Earnings ESP of +5.66% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Nu Skin Enterprises (NUS - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank #3.
Turning Points Brands (TPB - Free Report) has an Earnings ESP of +8.74% and a Zacks Rank #3.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

More from Zacks Analyst Blog

You May Like