E.W. Scripps shines among floundering group-Barron's
Sunday, December 24, 2006; 12:49 PM
NEW YORK (Reuters) - While most newspaper company's have been floundering because of sagging advertising revenue and circulation, E.W. Scripps <SSP.N> has been racking up some healthy numbers, Barron's said in its December 25 edition.
Scripps, publisher of papers such as Denver's Rocky Mountain News, has been riding a wave of revenue from its relatively new collection of cable channels, such as Home and Garden Television (HGTV), Fine Living, and the Food Network, Barron's said.
The company also has one of the hottest specialized Internet search engines, Shopzilla.com, the only shopping-comparison site to break the top 10 online shopping destinations the day after Thanksgiving (coming in at No. 7), Barron's said.
Overall cash flow is expected to rise about 11 percent on average during the next five years on mid-single-digit revenue gains and earnings should compound at 16 percent on average, Barron's said.
Many of Scripps' businesses are posting stronger growths. Revenue from the networks segment rose 19 percent in the third quarter and cash flow jumped 32 percent.
The company's interactive-media segment grew 73 percent. Cash flow is expected to rise to about $65 million this year from $28 million and to reach a range of $80 million to $85 million, next year, Barron's said.
Even Scripps "old media" newspapers and television stations are above average in the industry, Barron's said.
Prudential Equity Group sees the company's stock climbing to $60 per share over the next 12 months and Credit Suisse sees that stock at $62, Barron's said.
The stock closed at $42.23 on Friday.
"Scripps looks like a million bucks, and it's just warming up," Larry Haverty, media specialist and co-portfolio manager at Gabelli Global Multimedia Trust fund, told Barron's.