The New York Times Company Profile - Case Study Example

Company profile The New York Times Company, incorporated on 26th August 1896, is a global, multimedia news and information company that includes newspapers, investments in paper mills, digital businesses and other investments. The headquarters of the New York Times Company is in New York. The company publishes the New York Times which is the iconic newspaper and one of the world’s most respected sources of news. The New York Times boasts of a weekly newspaper circulation of about 1.3 million. The company also offers platform through which other companies such as The Boston Globe distributes their papers online (Drexler, 2007). The New York Times sold content portal About Group in late 2012. Chairman Arthur Sulzberger and his family control the company through a trust. The company has vowed to develop content from existing and emerging platforms like the wireless communication, in-house digital media, broadband technologies and the internet (Drexler, 2007). In an effort to acknowledge, the tremendous performance The New York Times has had through its segments since inception, the paper seeks to perform a business and corporate level strategy analysis of the firm and predict its future in the communication sector. The New York Times business segments The New York Times operates in two divisions: The New York Times Media Group and the New England Media Group. The New York Times Media Group: The New York Times Media Group comprises of the New comprises of the New York Times which is a daily and Sunday newspaper media house; the New York Times index which is a print publication and in addition producing and licensing the New York Times Index; the International Herald Tribune which is a daily Newspaper; NYTimes.com; Digital Archive Distribution business that is responsible for licensing electronic archive database to resellers of that information in the professional, business, and library markets (Drexler, 2007). The New York Times Media Group is also responsible and management of the New York Times News Services Division. This main function New York Times News Services Division is the transmission of articles, graphics and photographs from the globe, the Times and several other publications to magazines, newspapers and web sites (New York Times (Firm), & In Claiborne 1966). New York Times News Services Division also performs the function of distributing content online in addition to other digital platforms including e-reader and mobile applications, and social networking sites. The New England Media Group: This segment of New York Times comprises BostonGlobe.com which is a paid subscription Web site; the Boston Globe which is a daily and Sunday newspaper. Boston.com is also part of the New England Media Group. Boston.com is a regional news and information web site. In addition, the New England Media Group comprises of the Worcester Telegram & Gazette which is a daily and Sunday newspaper and Telegram.com (BYERS, 2012). The New England Media Group sells advertisement through various channels that basically include digital, print, niche magazines, direct marketing and internet radio and events (Hitt, Ireland & Hoskisson, 2007). The New York Times competes with the Wall Street Journal, the Financial Times, USA Today, Bloomberg Business Week, Time, CNN, CNNi, The Economists, Google News, Yahoo News, Sky News International, BBC, CNBC, WSJ.com, guardian.co.uk, and many more. The New York Times Company is important because its acts as the barometer of the entire newspaper industry’s health (Business Wire, 2013). The decision undertaken by the New York Times Company management are studied closely and copied by other newspaper companies which focuses on surviving the every changing business environment. Key people within the company include; Arthur O. Sulzberger, Jr (Chairman), Michael Golden (Vice Chairman), Mark Thompson (President and CEO) (BYERS, 2012). These people make up the management of the company hence any key decisions are made by them. The most current business strategy unveiled by the New York Times is the concept known as “Invest in the Times”. Spearheaded by the Chairman Arthur Sulzberger Jr., the goal of this strategy-which was also called “invest in the core”- was to extend the reach of the Times brand by increasing investment in four key areas (BYERS, 2012). These areas include video, mobile, social engagement and new global markets. This strategy will be made possible through the sale of other properties (BYERS, 2012). Mark Thompson, the president and the CEO of the company was quoted saying; “We mean to grow our business by launching new products and services based on the unique strengths of Times journalism and by investing in the rapid expansion of existing operations – video and live events are examples – where we’re already seeing strong growth. We want to deepen our relationship with our existing loyal customers, but we also want to use a wider family of New York Times products to reach new customers both here and around the world”(BYERS,2012). Another key strategy undertaken by the company is growing international subscribers. As announced in early 2013, the company will rebrand the International Herald Tribune as the International New York Times as per the 4th quarter of 2013 (Business Wire, 2013). Much of the successes of the company are attributed to stable management and lack of internal quarrels. This has enabled the company to penetrate in the competitive communication industry hence more profit (Business Wire, 2013). The company has started in a strong financial background this 2014. This is because of a strong finish of the year 2013. The New York Times’ operating profit for the 3rd of 2013 before depreciation, severance, and amortization was nearly $40 million. This represents 35% increase from the same year 2012 which was $30 million (Verbeke, 2013). During the same quarter of 2013, the company increased overall revenue by 2% with the continued building of the digital scriber numbers and notable sequential improvement in print advertising revenue trends. The company’s revenue is over $2 billion. The digital subscriber count has also been on the increase with the International Herald Tribune recording approximately 727,000 subscribers by the end 2013 (Verbeke, 2013). Advertising realized significant increase in the 3rd quarter of 2013 as compared to the 1st quarter. However, revenues from advertising declined in the quarter by 2%. The company has realized a tremendous growth in assets and profits for the past five years (Verbeke, 2013). According to many analysts, this trend is projected to continue for the next 3 years considering the company’s strong participation in the industry. The mean rating of the company by the analysts is 3 out of 5. The mean sale for the past five years is 160,163,000. The earning per share is $460 while the P/E for the last five years is 16.67 (Business Wire, 2013). The New York Times Company is a leading global, multimedia news and information company. The company’s main objective is to enhance society by creating, collecting and distributing high-quality news and information (Business Wire, 2013). By the fact of quality and breadth of its journalism, the company has become one of the best-known news organizations in the world. The communication industry is characterized by extensive competition (Drexler, 2007). In order to remain competitive, the company has invested in international marketing and in pricing and payment methods to localize the purchase process (Business Wire, 2013). The company has also invested in unified brands to help drive international revenues, especially through acquisition of new digital subscribers. These factors and effective management has helped the company to realize sustainable growth hence competitive advantage within the communication industry (Verbeke, 2013). The company has been operating in the major financial markets globally. The effectiveness of the company can be analyzed using various ratios (Verbeke, 2013). As per the 3rd quarter of 2013, the asset turnover of the company was 0.64 as compared to 0.47 of the industry. The company’s net profit margin was 7.93 while the pre-tax margin for the past 5 year averages 3.24 (Business Wire, 2013). The company’s quick ratio is 3.12 as compared to the industry’s 0.78. The current ratio is 3.14 while total debt to equity ratio is 99.99. The company’s market capitalization is 21.8951 billion dollars (Verbeke, 2013). The company’s dividend is 1.09 while the return on investment for the past 5 years is 1.61. For an investor who is interested in making gains on his investments, the New York Times is the place to invest. These financial ratios and other factors brings an element of optimism to the investor that he will reap gains from his investments. The graph below represents how the company’s shares have been performing in the New York financial markets and its projected performance. (BYERS, 2012) In analyzing the New York Times total return, one would predict that the firm stands a chance of enhancing its operations in the future upon maintaining the same level of production. Historically, the company’s profitability has been increasing relative to other players in the market. Given the company’s great policies in regards to employees, it will be a great pleasure to work for New York Times Company. My passion for media industry is unquestionable and I believe New York Times would be a perfect place to realize my dream and develop as a renowned media personality. The graph above represents how the company’s shares have been performing in the New York financial markets and its projected performance. The company’s financial ratio reveals stability and growth oriented company. This brings a lot of confidence to an investor hence I will definitely buy this company’s stock while recommending some else to go buy them. There has been acquiring many affiliate companies of late but there have been no ongoing talks towards mergers. The company has also put plans to acquire some properties to add to their stocks. The data was analyzed using ratio analysis. The financial ratio such as Liquidity Analysis Ratio, current ratio and many others are compared with the relevant industry ratios to get the current performance of the company. The crystal ball shows a positive growth by the company in terms of profit and assets for the next ten years. References BYERS, D. (2012). The new New York Times business strategy. DYLAN BYERS , 43-45. Drexler, K. M. (2007). Icons of business: An encyclopedia of mavericks, movers, and shakers. Westport, Conn: Greenwood Press. Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2007). Strategic management: Competitiveness and globalization; [concepts and classes]. Mason, Ohio [u.a.: Thomson South-Western. New York Times (Firm), & In Claiborne, C. (1966). The New York times menu cook book. New York: Harper & Row. Verbeke, A. (2013). International business strategy: Rethinking the foundations of global corporate success. Business Wire, N. Y. (2013). The New York Times Announces New Strategy for Growth. business wire, 8-10. Bloomberg.com Read More