Meredith Earnings Preview

Meredith (NYSE: MDP  ) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings Thursday. Meredith engages in magazine publishing and related brand licensing, television broadcasting, integrated marketing, interactive media, and video production operations. It operates two business segments: national and local media.

What analysts say:

• Buy, sell, or hold?: Analysts generally think investors should hang on to Meredith, with half rating the stock a hold. Analysts don't like Meredith as much as competitor Scholastic overall. Two out of three analysts rate Scholastic a buy compared with three of six for Meredith. Analysts still rate the stock a Hold, but they are a bit more wary about it compared with three months ago.
• Revenue forecasts: On average, analysts predict $356.8 million in revenue this quarter. That would represent a decline of 2.3% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.65 per share. Estimates range from $0.65 to $0.66.

What our community says:
CAPS All-Stars are solidly backing the stock with 90.6% granting it an "outperform" rating. The community at large agrees with the All-Stars with 80.7% assigning it a rating of "outperform." Fools are bullish on Meredith, though the message boards have been quiet lately with only 53 posts in the past 30 days. Meredith's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Meredith's profit has risen year over year by an average of 6.6%. A year-over-year revenue decrease last quarter snaps a streak of three consecutive quarters of revenue increases.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q3	Q2	Q1	Q4
Gross Margin	60.3%	62.4%	58.3%	62.7%
Operating Margin	15.2%	19.0%	13.8%	15.6%
Net Margin	9.1%	11.1%	7.5%	9.1%

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