Investors in Time Warner Inc (NYSE:TWX) can capitalize on the company’s dividend payout of $1.15 per share, offering an annual dividend yield of 1.90%. This, coupled with an estimated operating income this year of more than $7.5 billion, should aptly reward share holders in both the near and long-term.
News Corp (NASDAQ:NWSA) is yet another diversified media company with a worldwide presence. With its production of cable network programming and licensing of news programs, this media outlet had also branched out into the publishing world through the creation of free-standing inserts that include coupons and other types of in-store marketing products, aiming to catch the eye of consumers. News Corp. is also the owner of Dow Jones, the publisher of The Wall Street Journal.
News Corp (NASDAQ:NWSA) reported better-than expected earnings on May 8. While the publishing and education segments remained slow, strengths in the cable division helped the company beat the sell side estimates. For the fiscal third quarter, revenue rose 14% to $9.55 billion. EPS came in at $0.36, a penny better than expected. The company now expects total operating income for the fiscal year 2013 to increase up to 10%.
Once again, cable networks showed the most impressive results, accounting for about three-fourths of the total operating income, with a year over year growth in the mid-teens. Whereas, with only 2% increase in the operating income, advertising growth was far more modest. The company also confirmed that it is on track to split-off its slow-growing publishing business by the end of June.
One reason for News Corp (NASDAQ:NWSA)’s planned exit from the publishing arena has a great deal to do with massive declines in print advertising revenue. This certainly goes hand in hand with the dying newspaper industry overall. With the ability to obtain news and other information — including coupons — via mobile devices and online, media companies are seeking ways to capitalize on more digital offerings, while ridding themselves of more antiquated products and services.
While investors can earn a small amount of dividend income — $0.17 per share, per quarter — they may be better off waiting for share price appreciation. However, that remains to be seen, once News Corp. sells off its publishing entity.
The bottom line
Just as with Time Warner Inc (NYSE:TWX) and News Corp, The Walt Disney Company (NYSE:DIS) will need to continue its focus on the more profitable arms of its empire, while ridding itself of its less profitable divisions. Over the past few years, Disney has proven to be successful with its acquisitions — which have certainly helped in keeping the share price high and investors happy.
Looking forward, Disney stock appears to possess several positive attributes, including its forward moving momentum. Should the company continue to capitalize on blockbuster movies, its shares should continue rewarding investors.
The article A Few Reasons Why This Stock Might Get Better originally appeared on Fool.com and is written by Nauman Aly.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
