The New York Times Co. (NYT) stock broke out on Thursday after the news outlet reported third-quarter earnings and sales above expectations. Strong digital subscription and ad revenue could continue into the fourth quarter. Reader interest in President Donald Trump, who frequently attacks the "failing" New York Times and other media outlets as fake news, has been a boon for the news organization.
XEarnings per share tumbled 25% to 15 cents. But that was still above Wall Street's expectations for 13 cents EPS. Revenue climbed 8.2% to $417.3 million, above estimates for $410 million.
New York Times subscription sales comprised nearly two-thirds of total sales. Revenue from those subscriptions rose 4.5% during the quarter. The company added 203,000 net new digital-only subscriptions during the quarter. Advertising sales rose 7.1%.
"We're investing aggressively in our journalism, product and marketing and are seeing tangible results in our digital growth," CEO Mark Thompson said in a statement.
New York Times Stock
Shares jumped 6.9% to 28.23 in the stock market today, hitting their best levels since early 2006. New York Times stock cleared a cup base and closed just out of range of a 26.95 buy point.
While a rally is underway, it's still a stock market correction. Until the market confirms a new uptrend, investors should be wary of making new purchases.
Gannett (GCI) rose 1.1%, hitting resistance at its 50-day line. McClatchy (MNI) was up 1.5%. News Corp. (NWSA) dipped 0.45%.
Like others in the layoff-prone newspaper industry, the New York Times has tried to navigate the shift away from print into a digital landscape in which many readers still expect to receive online news for free.
But the Times was one of the first, and most successful, news organizations to get readers to pay for digital content.
The New York Times has been a frequent object of preoccupation — and, in public, mostly derision — for President Trump, who has railed against the paper to gin up support among his base.
Newspaper stocks shot higher after Trump's election in 2016, on expectations of higher drama between the media and the president, whose attempts to sow doubts about the Times, CNN and other big media outlets have become a refrain during rallies. New York Times stock has more than doubled in value since the week of the 2016 election.
New York Times Subscription Guidance
How the company will fare during the fourth quarter depends on whether you factor in one less week for the period than the fourth quarter last year. This year's fourth quarter is only 13 weeks long. Last year's was 14 weeks.
Excluding the extra week from last year, the company expects Q4 subscription sales to rise "in the mid-single digits," the company said. Digital-only subscription revenue is forecast to rise "in the mid-teens." Ad sales were expected to be roughly flat, with digital ad sales increasing in the mid-teens.
Including that extra week, those results are more muted. Subscription sales are expected to be down in the low to mid-single digits. Digital-only subscription sales are seen up in the high-single digits. Ad sales are expected to be down in the mid-single digits, with digital ad sales up in the mid-single digits.
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The post Not Fake News: New York Times Stock Breaks Out As Trump Bump Continues appeared first on Investor's Business Daily.
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