NEW YORK (TheStreet) -- Benchmark upgraded magazine publisher Meredith Corporation (MDP) to "buy" from "hold" with a $52 price target. The investment firm said recent TV acquisitions are shifting the mix positively toward broadcasting.
Also See: Meredith to Expand TV Portfolio
TheStreet Ratings team rates MEREDITH CORP as a Buy with a ratings score of B+. The team has this to say about their recommendation:
"We rate MEREDITH CORP (MDP) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures 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 analysis by TheStreet Ratings Team goes as follows:
- The current debt-to-equity ratio, 0.39, 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 0.64, displays a potential problem in covering short-term cash needs.
- The gross profit margin for MEREDITH CORP is rather high; currently it is at 62.66%. 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, the net profit margin of 8.63% trails the industry average.
- MDP, with its decline in revenue, slightly underperformed the industry average of 4.4%. Since the same quarter one year prior, revenues slightly dropped by 1.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- MEREDITH CORP's earnings per share declined by 15.2% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, MEREDITH CORP increased its bottom line by earning $2.74 versus $2.32 in the prior year. For the next year, the market is expecting a contraction of 1.5% in earnings ($2.70 versus $2.74).
- You can view the full analysis from the report here: MDP Ratings Report