NEW YORK (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- The current debt-to-equity ratio, 0.32, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that MDP's debt-to-equity ratio is low, the quick ratio, which is currently 0.61, displays a potential problem in covering short-term cash needs.
- Net operating cash flow has increased to $65.12 million or 13.44% when compared to the same quarter last year. Despite an increase in cash flow, MEREDITH CORP's average is still marginally south of the industry average growth rate of 13.97%.
- The gross profit margin for MEREDITH CORP is rather high; currently it is at 60.90%. Regardless of MDP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MDP's net profit margin of 9.60% compares favorably to the industry average.
- The revenue fell significantly faster than the industry average of 20.5%. Since the same quarter one year prior, revenues fell by 10.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
Meredith Corporation, a media and marketing company, engages in magazine publishing and related brand licensing, television broadcasting, integrated marketing, interactive media, and video production businesses in the United States. It operates in two segments, National Media and Local Media. The company has a P/E ratio of 11.7, below the average media industry P/E ratio of 12.1 and below the S&P 500 P/E ratio of 17.7. Meredith has a market cap of $1.18 billion and is part of the
industry. Shares are down 0.5% year to date as of the close of trading on Wednesday.
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