NY Times’ Stock To Likely Trade Lower Post Q1

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Trefis
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New York Times

New York Times’ stock (NYSE: NYT), a diversified media company that includes newspapers, internet businesses, television, and radio stations, is scheduled to report its Q1 2023 results on Wednesday, May 10. We expect NYT stock to trade lower with revenues and earnings missing consensus expectations marginally for its first-quarter results. The company continues to wrestle with the industry-wide slowdown in digital advertising. But the growth in its subscriber base is a big positive for the longer term. For the upcoming Q1 results, NYT sees digital-only subscription revenue rising to about 13% to 16% year-over-year (y-o-y), and total subscription revenue up 6% to 9%. The digital ad revenues and the larger total ad revenues are expected to decline by low single digits.

Our forecast indicates that NY Times’ valuation is $39 per share, 2% lower than the current market price. Look at our interactive dashboard analysis on New York Times Earnings Preview: What To Expect in Fiscal Q1? for more details.

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(1) Revenues expected to be slightly below the consensus estimates

Trefis estimates NY Times’ Q1 2023 revenues to be around $569 Mil, slightly below the consensus estimate. In Q4, NYT’s revenue grew 12% y-o-y to $667.5 million. This figure came as subscriptions continued to make up for advertising in the revenue stream. To break down the revenue gains further, advertising revenue increased fractionally y-o-y to $179.2 million, but subscription revenues rose 18% y-o-y to $414.1 million. Other revenue landed at $74.3 million. The company changed its fiscal year to line up with the calendar year, as a result, Q4 2022 had an extra six days compared with the fourth quarter of 2021. In 2022, NYT’s 9.55 million subscribers purchased approximately 10.98 million paid subscriptions to its digital and print products – of which paid digital-only subscribers totaled 8.83 million. The company continues to be on track for its new target of at least 15 million total subscribers by the end of 2027.

2) EPS to likely miss consensus estimates marginally

NYT’s Q1 2023 earnings per share (EPS) is expected to come in at 16 cents per Trefis analysis, missing the consensus estimate marginally. NYT adjusted earnings came in at 59 cents per share, up 37% y-o-y in Q4 2022.

(3) Stock price estimate lower than the current market price

Going by our NYT’s Valuation, with an EPS estimate of around $1.26 and a P/E multiple of 31.0x in fiscal 2023, this translates into a price of almost $39, which is nearly 2% lower than the current market price.

It is helpful to see how its peers stack up. NYT Peers shows how NYT’s stock compares against peers on metrics that matter. You will find other useful comparisons for companies across industries at Peer Comparisons.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

Returns May 2023
MTD [1]
2023
YTD [1]
2017-23
Total [2]
 NYT Return 1% 23% 200%
 S&P 500 Return -1% 8% 85%
 Trefis Multi-Strategy Portfolio 0% 8% 240%

[1] Month-to-date and year-to-date as of 5/8/2023
[2] Cumulative total returns since the end of 2016

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