Up 47% Since Beginning of 2023, How Will NY Times’ Stock Trend After Q4 Earnings?

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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 Q4 2023 results on Wednesday, February 7. We expect NYT stock to likely see little to no movement, with revenues and earnings matching consensus expectations for its fourth-quarter results. The company continues to wrestle with the industry-wide slowdown in digital advertising and a decline in print revenues, due to a tough macro climate. For Q4, NYT sees digital-only subscription revenue rising to about 6% to 9% year-over-year (y-o-y), and total subscription revenue up 2% to 5%. The total advertising revenues are expected to range from a decrease of low-single digits to an increase of mid-single digits. This range reflects the ongoing low visibility the company is seeing in the advertising market.

NYT stock has seen little change, moving slightly from levels of $50 in early January 2021 to around current levels, vs. an increase of about 30% for the S&P 500 over this roughly 3-year period. Overall, the performance of NYT stock with respect to the index has been quite volatile. Returns for the stock were -7% in 2021, -33% in 2022, and 51% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 24% in 2023 – indicating that NYT underperformed the S&P in 2021 and 2022. In fact, consistently beating the S&P 500 – in good times and bad – has been difficult over recent years for individual stocks; for heavyweights in the Consumer Discretionary sector including AMZN, TSLA, and HD, and even for the megacap stars GOOG, MSFT, and AAPL. In contrast, the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has outperformed the S&P 500 each year over the same period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics. Given the current uncertain macroeconomic environment with high oil prices and elevated interest rates, could NYT face a similar situation as it did in 2021 and 2022 and underperform the S&P over the next 12 months – or will it see a strong jump?

Our forecast indicates that NY Times’ valuation is $46 per share, almost matching the current market price. Look at our interactive dashboard analysis on New York Times Earnings Preview: What To Expect in Fiscal Q4? for more details.

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(1) Revenues expected to be in line with the consensus estimates

Trefis estimates NY Times’ Q4 2023 revenues to be around $680 Mil, in line with the consensus estimate. In Q3, NYT’s revenue grew 9% year-over-year (y-o-y) to $598.3 million as the company wrestled with the industry-wide slowdown in digital advertising. That figure came as subscriptions continued to make up for advertising in the revenue stream. To break down the revenue gains further, subscription revenues rose 9% to $418.6 M, advertising revenue grew 6% y-o-y to $117.1M and, other revenue landed at $62.7 Mil, up 15% y-o-y. The total digital-only average revenue per user (ARPU) was $9.28 for Q3 2023, an increase of 1.4% compared with Q2 2023 and 4.6% compared with Q3 2022.

The media company surpassed 10 million subscribers across its print and digital products. The company continues to be on track for its target of at least 15 million total subscribers by the end of 2027.  For the full-year 2023, we expect NYT’s Revenues to grow 5% y-o-y to $2.4 billion.

2) EPS to likely match consensus estimates 

NYT’s Q4 2023 earnings per share (EPS) is expected to come in at 59 cents per Trefis analysis, in line with the consensus estimate. NYT earnings came in at 32 cents per share, up 45% y-o-y in Q3 2023.

(3) Stock price estimate in line with the current market price

Going by our NYT’s Valuation, with an EPS estimate of around $1.52 and a P/E multiple of 30.5x in fiscal 2023, this translates into a price of almost $46, nearly matching 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.

Returns Feb 2024
MTD [1]
Since start
of 2023 [1]
2017-24
Total [2]
 NYT Return -2% 47% 258%
 S&P 500 Return 2% 29% 121%
 Trefis Reinforced Value Portfolio 0% 38% 608%

[1] Returns as of 2/5/2024
[2] Cumulative total returns since the end of 2016

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