Gannett Corp. (NYSE: GCI) has had a challenging year. The company, which has been on a buying spree, saw its stock underperform the market and the media sector, as shown below. The company's planned acquisition of Tronc (NASDAQ: TRNC) failed after lenders pulled out of the deal. The deal was intended to help Gannett penetrate the big cities like Chicago and Los Angeles.
Yesterday, the company released its 4Q'16 report, which beat analysts' forecasts. EPS was $0.50 beating forecasts by $0.08 while revenues of $867 million beat estimates by $19.67. The company's earnings were enhanced by acquisitions the company made during the year. On an adjusted basis that excludes the acquisitions, the company's revenues declined 7.7%.
In this article, I will look at the reasons I believe Gannett is a buy at the current price. My thesis is based on the company's valuation, dividend yield, and the management's guidance.
