News (NWSA) and Lee Enterprises (LEE) Head to Head Review

News (NASDAQ: NWSA) and Lee Enterprises (NYSE:LEE) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, valuation and profitability.

Analyst Ratings

This is a summary of recent ratings and recommmendations for News and Lee Enterprises, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
News 0 2 2 0 2.50
Lee Enterprises 0 0 0 0 N/A

News currently has a consensus price target of $15.50, indicating a potential downside of 4.79%. Given News’ higher possible upside, equities research analysts plainly believe News is more favorable than Lee Enterprises.

Profitability

This table compares News and Lee Enterprises’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
News -7.96% 2.27% 1.74%
Lee Enterprises 4.85% -13.80% 2.29%

Insider & Institutional Ownership

61.0% of News shares are owned by institutional investors. Comparatively, 31.8% of Lee Enterprises shares are owned by institutional investors. 13.9% of News shares are owned by insiders. Comparatively, 7.3% of Lee Enterprises shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares News and Lee Enterprises’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
News $8.14 billion 1.17 -$738.00 million ($1.13) -14.41
Lee Enterprises $566.94 million 0.24 $27.48 million $0.50 4.80

Lee Enterprises has lower revenue, but higher earnings than News. News is trading at a lower price-to-earnings ratio than Lee Enterprises, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

News has a beta of 2.06, suggesting that its stock price is 106% more volatile than the S&P 500. Comparatively, Lee Enterprises has a beta of 2.13, suggesting that its stock price is 113% more volatile than the S&P 500.

Dividends

News pays an annual dividend of $0.20 per share and has a dividend yield of 1.2%. Lee Enterprises does not pay a dividend. News pays out -17.7% of its earnings in the form of a dividend.

Summary

News beats Lee Enterprises on 10 of the 15 factors compared between the two stocks.

About News

News Corporation is a diversified media and information services company. The Company operates in five segments: News and Information Services, Cable Network Programming, Digital Real Estate Services, Book Publishing, and Other. The Company’s business consists of range of media, including news and information services, sports programming in Australia, digital real estate services, book publishing, and pay-television (TV) distribution in Australia, that are distributed under the brands, including The Wall Street Journal, Dow Jones, Herald Sun, The Sun, The Times, HarperCollins Publishers, FOX SPORTS Australia and realestate.com.au. The Company is a developing provider of digital education content, assessment and delivery services. The Company’s business component includes News and Information Services, Cable Network Programming, Digital Real Estate Services, Book Publishing, Amplify and Foxtel. In July 2014, it completed the acquisition of Harlequin Enterprises from Torstar Corp.

About Lee Enterprises

Lee Enterprises, Incorporated is a provider of local news and information, and a platform for print and digital advertising. The Company’s products included 46 daily and 34 Sunday newspapers, 300 weekly newspapers, and classified and niche publications, as of September 25, 2016. The Company also provides a range of digital products, including video, digital couponing, behavioral targeting, audience retargeting, banner advertisements and social networking. It provides digital marketing services to small and midsized businesses (SMBs), including search engine marketing (SEM), social media, audience extension, business profiles, and Website hosting and design. It offers small business solutions, including search engine optimization (SEO), local online marketing, social media marketing, video advertising and Website design. The markets it caters to are located primarily in the Midwest, Mountain West and West regions of the United States.

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