This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Jill Abramson Firing Immaterial to Analysts

NEW YORK (TheStreet) - The abrupt firing of Jill Abramson, the first female Executive Editor of the New York Times (NYT - Get Report), may have created a media sensation. Equity analysts, however, could care less.

>> Read More: New York Times Tumbles As Abramson Is Abruptly Fired

No analyst covering the New York Times stock changed their ratings on the newspaper company's shares on Thursday, according to Bloomberg data. Morningstar analyst Liang Feng said in a telephone interview Thursday that an abrupt CEO or CFO change would be material, however, there is little to be made from Abramson's firing in the near-term.

"It is really hard to draw any conclusions," Feng said.

Wall Street's muted reaction to Abramson's firing indicates that it hardly matters who is managing America's largest newsroom, and the de facto paper of record, in the eyes of analysts. Whether it's Jill Abramson, or incoming Executive Editor Dean Baquet, the first black man appointed to run the Times' newsroom, it just doesn't appear to matter.

Shares in the New York Times haven't fallen much more than the broader market since the firing was made public on Wednesday afternoon. The Times was down less than 1% at $15.02 in late Thursday afternoon trading.

Wall Street may be wrong to dismiss the Abramson firing as an immaterial event.

Yes, it is people like CEO Mark Thompson and CFO Michael Golden who are responsible for devising the Times strategy and managing the company's purse strings. Recently, the Times decided to reinstate a quarterly dividend, something that might have been hard to imagine just a few years ago when the paper teetered on the brink of bankruptcy.

Still, it's the newsroom that ultimately builds the product that readers and advertisers pay for. That the Times has grown subscribers and revenue in recent years amid the replacement of print subscriptions with digital, and the emergence of user generated platforms like Twitter (TWTR) and Facebook (FB), signals strong execution.

Last quarter, the Times reported growth in both print and digital advertising revenue, with overall ad revenues growing 3% year-over-year. The company also added more net digital subscribers in the first quarter than at any time in 2013. Overall, digital subscribers rose 5% to 799,000 in the first quarter.

"[We] are certainly not claiming victory in advertising yet; we expect continued month-to-month volatility and recognize that we will face some significantly tougher year-on-year comparisons as the year goes on," CEO Thompson said.

Was it Thompson, Chairman Arthur Sulzberger Jr., and other top executives who helped those growth numbers, or were they the spoils of strong performance in the Times newsroom since Abramson was appointed Executive Editor?

Amid cost cuts and a digital advertising model that often favors trivial content, the Times appears focused, still setting the agenda on many of the biggest national and international news stories. Will Baquet be a strong replacement to Abramson? We don't yet know. Did Abramson hold the Times back on its digital endeavors? That also is unclear.

Still, Abramson's firing may have a bigger impact on the Times performance than many on Wall Street expect. A report recently released by the Times shows that the company believes it has fallen behind in its digital efforts, harming readership and engagement.

Hopefully, the Times has found the right person to improve perceived areas of weakness. However, if, as some media reports suggest, Abramson's firing was the result of personality conflicts and an internal power struggle, it may be an issue that could loom large over the paper for quarters to come.

Bottom Line: If the Times didn't claim victory in the first quarter, the company may have just snatched defeat in a year that began with much promise.

>> Read More: New York Times Tumbles As Abramson Is Abruptly Fired

-- Written by Antoine Gara in New York.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
NYT $13.41 0.00%
AAPL $123.25 0.00%
FB $83.30 0.00%
GOOG $548.34 0.00%
TSLA $185.00 0.00%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs