Gannett Co., Inc. (GCI): A Bull Case Theory

We came across a bullish thesis on Gannett Co., Inc. (GCI) on Substack by Stock Analysis Compilation. In this article, we will summarize the bulls’ thesis on GCI. Gannett Co., Inc. (GCI)’s share was trading at $5.13 as of Nov 27^th.

A close-up of a newspaper press, illustrating the power of publishing.

Gannett is undergoing a digital transformation, aiming to increase its digital revenues to over 50% of total sales in the coming year, which should drive a return to revenue growth. This shift positions the company to capitalize on the growing digital media market, enhancing long-term prospects. In addition, Gannett has significant legal upside through its ongoing antitrust case against Google, with parallels to past successful cases that resulted in verdicts exceeding $1 billion. If Gannett wins the case, the financial windfall could easily surpass the company’s net debt, further strengthening its position. Despite these promising developments, the market has yet to recognize Gannett’s full potential. The company’s shares are trading at a strikingly low multiple of just 0.3 times normalized free cash flow, which is well below its peers, indicating a deep undervaluation. Given the progress in digital transformation and the potential for a legal windfall, there is a compelling case for substantial upside in Gannett’s stock price. The current valuation presents a unique opportunity for investors to capitalize on the company’s transformation and legal potential, with significant room for a re-rating and market cap growth in the near future.

Gannett Co., Inc. (GCI) is not on our list of the 31 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held GCI at the end of the third quarter which was 26 in the previous quarter. While we acknowledge the risk and potential of GCI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GCI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. This article was originally published at Insider Monkey.