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Q3 Earnings Preview for New York Times (NYSE:NYT)

in EARNINGS/INVESTING IDEAS by

The New York Times Company (NYSE:NYT) is scheduled to report Q3 earnings results on November 5, 2020.

The company is expected to report earnings of $0.12/share on revenue of $411.9 million. The consensus earnings per share (EPS) of $0.12/share is based on a poll of 6 analysts and represents a decline in eps of −0.5% over the same quarter last year, when the company reported earnings of $0.12/share.

The revenue forecast of $411.9 million based on a poll of 4 analysts implies a year-over-year (YoY) decline in revenue of −3.9%. Last year the company reported $428.5 million in revenue for the quarter.

Expected to report EPS contraction of −0.5% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $411.88 $428.50 −3.9%
EPS $0.12 $0.12 −0.5%

Earnings Call Trends

Management has been great at managing analyst expectations historically. The company has a perfect record over the last 8 tracked quarters of exceeding earnings guidance.

What are your expectations from The New York Times Company for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.03 $0.18 500.0% Beat
Q1, 2020 $0.09 $0.17 96.9% Beat
Q4, 2019 $0.29 $0.43 49.7% Beat
Q3, 2019 $0.09 $0.12 28.7% Beat
Q2, 2019 $0.16 $0.17 6.8% Beat
Q1, 2019 $0.12 $0.20 67.3% Beat
Q4, 2018 $0.30 $0.32 7.6% Beat
Q3, 2018 $0.12 $0.15 28.5% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 28, 2020, the stock price did not react much to the update.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 5, 2020 $46.79 $46.48 −0.7% Decline
May 6, 2020 $33.36 $35.10 5.2% Increase
February 6, 2020 $34.20 $37.42 9.4% Increase
November 6, 2019 $31.92 $30.21 −5.4% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.75, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.75 implies a 0.3% chance of earnings manipulation.

Fundamentals And Technical Analysis

The New York Times Company is currently trading at $40.46/share, down −1.9% for the day. The company is trading at approximately 84.6% of its 52-week high of $47.95/share. The company’s stock price is down −13.0% since the last earnings report and down −8.5% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 39.21 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:NYT Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 48.21 and a forward P/E multiple of 52.66.

The New York Times Company’s current share price also implies a price-to-book (P/B) multiple of 5.54. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 28, 2020
Stock Price (Current) $40.46
P/E Ratio 48.2x
P/E Ratio (Fwd) 52.7x
PEG Ratio 13.1
Total Debt / Total Capital 0.0%
Levered Free Cash Flow $200.6 million
EV / EBITDA 27.8x

Finbox

The New York Times Company is a mid-cap stock with a market capitalization of $6.879 billion and a total enterprise value of $6.124 billion. The company operates in the Communication Services sector and the Media industry.

The New York Times Company, together with its subsidiaries, provides news and information for readers and viewers across various platforms worldwide. It offers The New York Times (The Times), a daily and Sunday newspaper in the United States, as well as international edition of The Times; and operates the NYTimes.com Website. The company also transmits articles, graphics, and photographs from The Times and other publications to approximately 1,500 newspapers, magazines, and Websites; licenses electronic databases to resellers in the business, professional, and library markets; and offers magazine licensing, news digests, book development, and rights and permissions. In addition, it engages in the NYT Live business, a platform for its live journalism; operates Wirecutter, a product review and recommendation Website that serves as a guide to technology gear, home products, and other consumer goods; develops mobile applications, including Crossword and Cooking products; prints products for third parties; and offers other products and services. The company was founded in 1851 and is headquartered in New York, New York.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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