Meredith Earnings Preview

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Investors are on the edge of their collective seats, hoping that Meredith (NYS: MDP) will top analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Tuesday, Jan. 24. Meredith engages in magazine publishing and related-brand licensing, television broadcasting, integrated marketing, interactive media, and video production-related operations.

What analysts say:

  • Buy, sell, or hold?: Half of analysts think investors should stand pat on Meredith while the remaining half rate the stock as a buy. Analysts don't like Meredith as much as competitor Scholastic overall. Two out of three analysts rate Scholastic a buy compared to three of six for Meredith. Analysts' rating of Meredith has stayed constant from three months prior.
  • Revenue forecasts: On average, analysts predict $342.3 million in revenue this quarter. That would represent a decline of 6.7% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.67 per share. Estimates range from $0.66 to $0.70.

What our community says:
CAPS All-Stars are solidly behind the stock with 88.5% granting it an "outperform" rating. The community at large backs the All-Stars with 81.5% assigning it a rating of "outperform." Fools have embraced Meredith, though the message boards have been quiet lately with only 57 posts in the past 30 days. Meredith's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Meredith's profit has risen year over year by an average of 20.4% over the past five quarters. Revenue has fallen for the past three quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

58.3%

60.6%

60.3%

62.4%

Operating Margin

11.7%

16.1%

15.2%

19.0%

Net Margin

6.6%

8.7%

9.1%

11.1%

For all our Meredith-specific analysis, including earnings and beyond, add Meredith to My Watchlist.

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Earnings estimates provided by Zacks.

At the time this article was published

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