The New York Times Company: 2020 Investor Interests
Importance of elements that differentiate NYT publishing model
Interest in specific publishing products
Comments offered for NYT management and for other shareholders
Shareholders of The New York Times Company (“NYT”) were invited to report
their views of investor interests, anonymously, during the period from
August 17 to September 21, 2020.[1]
The
survey research was initiated by a NYT shareholder, guided by professional
investment and publishing industry advisers, to determine broader investor
market levels of analytical interest in particular elements of an apparently
successful business model. The
survey questionnaire requested an indication of the participating
shareholder’s investment horizon and then rankings of the importance of an
investor’s understanding various elements of the NYT publishing model.
Following those questions, participants were asked to volunteer information
that might be useful in analyzing anonymous responses, and were also offered
opportunities to present questions or comments for consideration by NYT’s
management or by other shareholders and analysts.[2]
Responses, details of which are reported below, provided two significant
indications of investor market support for NYT’s news publishing model and
related management strategies.
►
Participants reported higher levels of importance to understanding elements
of performance that distinguish NYT from alternative news publishing models,
as might be expected in shareholder views of a company they have selected
for investment. These were the most highly ranked, with very similar levels
of interest among all segments of shareholders.
(1)
Strategies for existing and new directly produced product
(2)
Size of subscribing audiences
(3)
Strategies and targets for subscription growth
► Most
notably, approximately three quarters of the participants, including a
majority of those owning 5,000 or more shares, reported investment horizons
of more than 5 years.
Importance of elements that differentiate NYT publishing
model
The
graph below shows participants’ rankings of their interest in understanding
each of the stated elements, listed here in the order of total responses
reporting “essential,” “important,” and “useful.”
|
Segment
Analysis
5,000 or more shares owned
 |
|
Response patterns did not differ meaningfully in rankings of importance
between participants reporting larger and smaller numbers of shares owned,
but larger shareholders evidenced somewhat higher levels of interest in
“Strategies and targets for subscription growth.”
The
graph image on the right shows the response levels for this key investor
segment, with each element presented in the same sequential order as the
graph above for purposes of comparison.
Interest in specific publishing products
Shareholders who considered levels of particular reader interest relevant to
investment analyses were asked how important it was for them to understand
NYT’s progress with specific types of publishing products, as well as the
importance of competitive quality for various publishing subjects. Responses
to both are shown in the following graphs, again with each subject
presented
in the
order of total responses reporting “essential,” “important” and “useful.”
Several participants offered views relating to “other” publishing products,
including suggested attention to science and technology, and to editorials
relating to political and social issues. Many of the comments offered in
response to an invitation of “other observations” addressed participants’
interests as readers, as might be expected from shareholders who were also
subscribers, but also included these examples focused on investment
interests (all comments are available for review in an exhibit referenced
below):
-
Our
shares have gone up because NYT is making smart decisions on how to
capture audience in many different ways and overall coverage of Trump's
shenanigans is essential.
[individual investor, over 5,000 shares]
-
Understanding actual and expected conversion of intro subs into full
paying subs by cohort, especially during the recent period of accelerated
intro subscribers, is essential to my investment analysis of the NYT.
Thank you for putting this questionnaire together!
[professional fund manager, over 5,000 shares]
-
How
about in-depth investigative reporting e.g. in the Sunday Magazine?
[individual investor, less than 5,000 shares]
Comments offered for NYT management and for other
shareholders
Participating shareholders were invited to present comments and questions
for NYT management, as well as suggestions of subjects for future company
reports or conference call presentations, with the assurance that their
responses would be presented to the company with sources identified only as
anonymous participants in the survey. Participants were also invited to
offer questions and comments for consideration by other shareholders, with
similar provisions for anonymity.
The
following examples of comments provide an indication of the interests
addressing investment issues.
Questions or comments for management consideration:
-
You
guys are the experts, and I'm sure the you have considered it, but I would
imagine that there is enormous potential to leverage your national and
international reporting across many new paid digital subscribers by
offering local content specific to many locales. Local papers are really
dying. You could replace many of them and throw in excellent
national/international coverage. Plenty of local reporters out there
looking for a job. But, as hard as it seems, you may have to consider a
name change for a product like this!
[individual investor, over 5,000 shares]
-
What
is the new CEOs strategy.
[individual investor, less than 5,000 shares]
-
How
do you view The NYT's partnership with ProPublica?
[individual investor, less than 5,000 shares]
-
What
plans do you have for advancing the ethics in today's journalism? How do
you plan to attract talented young people to journalism?
[professional fund manager, less than 5,000 shares]
For
management to address in a future conference call or report:
-
More granular view on pricing cohorts and overall financial impact of
price increases. Margin expansion: a significant portion of the cost
structure is somewhat fixed, it would be great for management to put some
hard stakes in the ground regarding margin expansion objectives. The
company is now very capital efficient and cash generative, it is more than
time that it presents to shareholders a coherent and value maximizing
capital allocation strategy.
[professional fund manager, over 5,000 shares]
-
[A] greater understanding of the revenue potential and profit opportunity
of digital, video, and podcasts.
[individual investor, more than 5,000 shares]
-
How NYT might be thinking about filling the void left by local reporting
in other markets (i.e., California edition).
[individual investor, more than 5,000 shares]
For
reporting to other shareholders:
All
comments, including the many observations focused on subscriber interests
which are clearly relevant at least indirectly to investor interests, are
presented in the following report with editing only to eliminate identifying
information:
2020 NYT Shareholder Survey: Participant
Comments
ttt
NYT
management has asked the Forum to report their gratitude to the shareholders
who offered their views, and the company’s Vice President of Investor
Relations has provided the following statement: “The New York Times Company
appreciates input from our shareholders and we will consider incorporating
this feedback in future communications.”
This
summary is being distributed to all shareholders who participated in the
survey and requested a report of its results, with thanks for their
contributions of views to benefit other shareholders and NYT’s management.
Questions and comments about the survey results will be welcomed, and can be
addressed to
nyt2020@shareholderforum.com.
GL
– September 30, 2020
Gary
Lutin
Chairman, The Shareholder Forum
©The Shareholder Forum, Inc.
