New York Times (NYSE:NYT) Shares Gap Down - Time to Sell?

Key Points

• NYT shares fell sharply, opening at $70.22 after a $75.61 close and later trading near $66.19, down 16.2%. The decline followed weaker-than-expected digital subscriber growth and a disappointing digital subscription revenue outlook.
• The company still beat quarterly expectations, reporting $0.69 EPS versus $0.67 expected and revenue of $762.46 million, up 11.2% year over year. However, it added about 280,000 digital-only subscribers, below the 295,300 analyst estimate.
• Analyst sentiment remains moderately positive, with a consensus rating of “Moderate Buy” and an average price target of $83.22, while unusual call-option activity suggests some investors anticipate a potential rebound.

The New York Times Company (NYSE:NYT - Get Free Report) gapped down before the market opened on Wednesday . The stock had previously closed at $75.61, but opened at $70.22. New York Times shares last traded at $66.19, with a volume of 1,055,693 shares.

New York Times News Summary

Here are the key news stories impacting New York Times this week:

• Positive Sentiment: NYT reported second-quarter earnings of $0.69 per share, above the $0.67 analyst consensus and up from $0.58 a year earlier. Revenue rose 11.2% year over year to $762.46 million, also exceeding estimates of $752.01 million. New York Times Co. Tops Q2 Earnings and Revenue Estimates
• Positive Sentiment: Unusual options activity indicated a potentially bullish position: investors bought 18,448 call options, more than 11 times the typical call volume. Options activity is not a guarantee of future stock performance, but it suggests heightened investor interest and possible expectations for a rebound.
• Neutral Sentiment: The company’s higher profit and revenue demonstrate continued progress in its digital business and monetization efforts, although investors focused more heavily on subscriber trends than on the quarterly earnings beat. New York Times Posts Higher Revenue, as Subscriber Growth Slows
• Negative Sentiment: NYT added approximately 280,000 net digital-only subscribers in the quarter, below analysts’ estimate of 295,300. The shortfall raised concerns that subscriber acquisition is losing momentum. NYT Stock Drops as Digital Subscriber Growth Misses Estimates
• Negative Sentiment: Management issued a weaker-than-expected outlook for digital subscription revenue. Because subscriptions are central to NYT’s long-term growth strategy, the guidance overshadowed the earnings and revenue beats and prompted the stock’s decline.

Analyst Upgrades and Downgrades

A number of brokerages recently commented on NYT. Deutsche Bank Aktiengesellschaft reaffirmed a "buy" rating and set a $95.00 price objective on shares of New York Times in a research report on Thursday, May 7th. Citigroup reissued a "neutral" rating on shares of New York Times in a research note on Wednesday, June 24th. Bank of America lowered their price target on shares of New York Times from $87.00 to $80.00 and set a "neutral" rating on the stock in a report on Wednesday, June 24th. Guggenheim upped their price target on shares of New York Times from $63.00 to $70.00 and gave the stock a "neutral" rating in a research note on Thursday, May 7th. Finally, JPMorgan Chase & Co. increased their price objective on New York Times from $74.00 to $82.00 and gave the stock an "overweight" rating in a report on Friday, May 29th. Two equities research analysts have rated the stock with a Strong Buy rating, four have given a Buy rating and five have given a Hold rating to the company's stock. According to data from MarketBeat, the company has an average rating of "Moderate Buy" and an average price target of $83.22.

New York Times Trading Down 16.2%

The stock has a market cap of $10.26 billion, a P/E ratio of 27.13, a P/E/G ratio of 1.56 and a beta of 0.95. The firm's fifty day moving average is $73.89 and its 200 day moving average is $76.31.

New York Times (NYSE:NYT - Get Free Report) last released its earnings results on Wednesday, August 5th. The company reported $0.69 earnings per share for the quarter, topping analysts' consensus estimates of $0.67 by $0.02. New York Times had a net margin of 13.18% and a return on equity of 22.02%. The firm had revenue of $762.46 million during the quarter, compared to analyst estimates of $752.01 million. During the same quarter in the previous year, the business earned $0.58 EPS. The business's revenue was up 11.2% on a year-over-year basis. Research analysts forecast that The New York Times Company will post 2.93 earnings per share for the current fiscal year.

New York Times Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Thursday, July 23rd. Investors of record on Wednesday, July 8th were given a dividend of $0.23 per share. This represents a $0.92 annualized dividend and a dividend yield of 1.5%. The ex-dividend date of this dividend was Wednesday, July 8th. New York Times's payout ratio is currently 39.48%.

Insider Buying and Selling

In related news, Director David S. Perpich sold 9,000 shares of the stock in a transaction that occurred on Monday, May 11th. The stock was sold at an average price of $77.06, for a total transaction of $693,540.00. Following the completion of the sale, the director owned 28,469 shares in the company, valued at $2,193,821.14. This represents a 24.02% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, EVP William Bardeen sold 4,121 shares of the firm's stock in a transaction that occurred on Tuesday, May 12th. The shares were sold at an average price of $77.85, for a total value of $320,819.85. Following the completion of the sale, the executive vice president directly owned 14,560 shares in the company, valued at $1,133,496. This trade represents a 22.06% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders sold 17,121 shares of company stock valued at $1,310,920. Insiders own 1.90% of the company's stock.

Institutional Trading of New York Times

Hedge funds have recently modified their holdings of the company. Empowered Funds LLC acquired a new position in shares of New York Times in the first quarter valued at $442,000. Focus Partners Wealth boosted its stake in New York Times by 52.2% during the first quarter. Focus Partners Wealth now owns 11,640 shares of the company's stock worth $577,000 after buying an additional 3,990 shares in the last quarter. Geneos Wealth Management Inc. increased its holdings in New York Times by 690.7% in the 1st quarter. Geneos Wealth Management Inc. now owns 846 shares of the company's stock valued at $42,000 after buying an additional 739 shares during the period. Baird Financial Group Inc. bought a new stake in New York Times in the 2nd quarter valued at $306,000. Finally, Cerity Partners LLC raised its stake in shares of New York Times by 70.2% in the 2nd quarter. Cerity Partners LLC now owns 55,423 shares of the company's stock valued at $3,103,000 after buying an additional 22,853 shares in the last quarter. Institutional investors own 95.37% of the company's stock.

New York Times Company Profile

The New York Times Company is a publicly traded media organization best known for publishing The New York Times newspaper and operating the NYTimes.com digital platform. The company produces daily print and digital journalism covering national and international news, opinion pieces, feature stories, and multimedia content. Alongside its flagship newspaper, the firm offers a range of subscription-based services, including Times Cooking, NYT Games, podcasts and newsletters, designed to engage a broad audience of readers and advertisers.

Founded in 1851 by Henry Jarvis Raymond and George Jones, The New York Times has built a reputation for in-depth reporting and investigative journalism.

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