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On Thursday, Guggenheim Securities adjusted its financial outlook for The New York Times Company (NYSE:NYT), increasing the stock’s price target to $53.00 from the previous $52.00 while maintaining a Neutral rating on the shares. The revision follows the media company’s first-quarter 2025 performance, which surpassed Guggenheim’s projections due to robust digital advertising growth and reduced operating expenses. According to InvestingPro data, NYT demonstrates exceptional financial health with a perfect Piotroski Score of 9, indicating strong operational efficiency and financial stability.
The New York Times reported first-quarter revenue of $636 million, slightly higher than Guggenheim’s estimate of $634 million. The adjusted operating profit for the quarter also exceeded expectations at $93 million, compared to the anticipated $86 million. This positive outcome was attributed to the growth in digital advertising and a decrease in operating costs. The company’s strong performance is part of a broader trend, with trailing twelve-month revenue reaching $2.56 billion and maintaining a healthy gross profit margin of 48.8%.
The company’s digital news products gained 180,000 net new subscribers, a figure that stands well above Guggenheim’s estimate of 80,000 and reverses a previously challenging trend. However, the net additions for other single products, including The Athletic, Cooking, Games, and Wirecutter, were below expectations at 50,000, compared to the forecasted 110,000.
Looking ahead, Guggenheim has adopted a more optimistic view for the core news net additions in 2025, now expecting an increase of 490,000 subscribers, up from the prior estimate of 370,000 and the 410,000 net additions in 2024, which was a presidential election year typically associated with higher news consumption.
The average revenue per user (ARPU) for digital-only subscriptions grew by 3.6% year-over-year. Guggenheim anticipates this growth in ARPU to persist throughout 2025, although it also expects the year-over-year comparisons to become more challenging in the second half of the year.
The firm’s full-year 2025 adjusted operating profit (AOP) estimate for The New York Times has been raised to $509 million from the former $495 million estimate. The increase in the price target to $53 reflects the updated financial expectations and the company’s recent performance trends. Trading at a P/E ratio of 28.8x, NYT’s current market valuation appears to be aligned with its Fair Value, according to InvestingPro analysis. For deeper insights into NYT’s valuation and growth prospects, including access to 10+ additional ProTips and comprehensive financial metrics, explore the full Pro Research Report available on InvestingPro.
In other recent news, The New York Times Company reported impressive first-quarter 2025 financial results, exceeding analyst expectations. The company achieved earnings per share (EPS) of $0.41, surpassing the projected $0.34, and reported revenue of $635.9 million, slightly above the anticipated $635.29 million. Digital subscription revenue experienced a notable 14% increase, reaching $335 million, contributing to a total subscription revenue growth of 8% to $464 million. Additionally, digital advertising revenues rose by 12%, amounting to $71 million. The New York Times Company added 250,000 net new digital subscribers, bringing its total to 11.7 million digital-only subscribers. Analyst firms have not announced any recent upgrades or downgrades for the company. The company remains focused on disciplined cost management and anticipates further growth in digital subscription and advertising revenues in the upcoming quarters.
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