Gannett continues its digital push

GANNETT CO., INC. $12 (New York symbol GCI; Conservative Growth Portfolio, Consumer sector: Shares outstanding: 111.8 million; Market cap: $1.3 billion; Price-to-sales ratio: 0.4; Dividend yield: 5.3%; TSINetwork Rating: Average; www.gannett.com) publishes over 100 U.S. daily newspapers and their associated websites. That includes the company’s flagship daily USAToday. It also has papers in the U.K., and over 200 magazines and other publications.

The company has agreed to pay an undisclosed sum for a majority stake in Grateful Ventures. That privately held firm operates food-related websites, including Thanksgiving.com and FoodBlogs.com. Their merger with Gannett’s own websites should win them more visitors.

Meantime, Gannett’s revenue in the quarter ended September 24, 2017, fell 3.6%, to $744.3 million from $772.3 million a year earlier. If you adjust for the new operations and foreign currency rates, revenue fell 9.4%. That’s mainly due to declining revenue from print advertising. However, the company continues to expand its Internet businesses: they now supply 33% of its total revenue. Thanks to lower costs, earnings per share jumped 166.7%, to $0.16 from $0.06.

Gannett is still a buy.

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Scott Clayton

Scott is an associate editor at TSI Network. He is the lead reporter and analyst for Dividend Advisor, Power Growth Investor and Canadian Wealth Advisor and a member of the Investment Planning Committee. Scott began his investment and financial career working with Pat McKeough at The Investment Reporter in the 1980s. Subsequently, he worked at the Financial Post Corporation Service for 10 years. He joined TSI Network in 1998. He is a Bachelor of Economics graduate of York University, and he also has an M.B.A. from the Schulich School of Business.

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