Goldman Sachs Predicts Q4 Results

By: E&P Staff Newspaper companies won't reveal last quarter's results until later this month, but Goldman Sachs issued a report today giving a sneak peak of how it will likely shape up. The investment firm forecasts newspaper companies to meet but not beat Q4 expectations. Analyst Peter Appert believes the view for 2005 will continue to be "cautious," with a potential for downward revisions.

Ad revenues should increase around 4.6% in Q4 compared with the same period last year. That's down from the previous quarter's growth rate of 5.4%. Though revenues will likely slow, Q4 earnings per share is expected to be "fractionally stronger" due to lower interest expense and share repurchase activity.

The report pegs Gannett to post "the most impressive year over year gains in EPS" but this is because the company's broadcast unit performed well, thanks to political ad dollars. McClatchy is also expected to come out on top because of ad growth in California markets and the Carolinas. The caboose in term of earnings: The New York Times. The forecast for the company is flat EPS due to "challenging ad conditions" at the New York Times paper.

On a related note, Merrill Lynch issued a report that said the newspaper group dipped 0.3% while the S&P500 ended up 0.3%.


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