How Will John Wiley & Sons (JW.A) Stock Be Affected By Its Fourth Quarter Earnings Results?

NEW YORK (TheStreet) -- John Wiley & Sons (JW.A) released its fourth quarter earnings before the bell onTuesday, reporting earnings and revenue ahead of analysts expectations for the quarter.

The academic publishing company reported a 2% year over year revenue increase to $457 million, ahead of analysts $441 million estimates.

The company also reported earnings of 77 cents per share, up 6 cents from the previous year's earnings.

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TheStreet Ratings team rates WILEY (JOHN) & SONS as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate WILEY (JOHN) & SONS (JW.A) 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 expanding profit margins, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for WILEY (JOHN) & SONS is currently very high, coming in at 74.70%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 11.46% trails the industry average.
  • Compared to its closing price of one year ago, JW.A's share price has jumped by 43.11%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.82 is somewhat weak and could be cause for future problems.
  • WILEY (JOHN) & SONS's earnings per share declined by 7.4% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, WILEY (JOHN) & SONS reported lower earnings of $2.39 versus $3.48 in the prior year. This year, the market expects an improvement in earnings ($2.95 versus $2.39).
  • JW.A, with its decline in revenue, underperformed when compared the industry average of 14.8%. Since the same quarter one year prior, revenues slightly dropped by 3.1%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • You can view the full analysis from the report here: JW.A Ratings Report
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