Critical Analysis: Gannett Co. (GCI) & Pearson, PLC (PSO)
Gannett Co. (NYSE: GCI) and Pearson, PLC (NYSE:PSO) are both consumer staples companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitabiliy, analyst recommendations, risk, valuation and dividends.
Institutional & Insider Ownership
84.1% of Gannett Co. shares are owned by institutional investors. Comparatively, 2.0% of Pearson, PLC shares are owned by institutional investors. 0.7% of Gannett Co. shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Gannett Co. and Pearson, PLC’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Gannett Co.||$3.16 billion||0.32||$317.33 million||($0.02)||-448.00|
|Pearson, PLC||$5.90 billion||1.18||$744.15 million||N/A||N/A|
Pearson, PLC has higher revenue and earnings than Gannett Co..
Gannett Co. pays an annual dividend of $0.64 per share and has a dividend yield of 7.1%. Pearson, PLC pays an annual dividend of $0.67 per share and has a dividend yield of 7.9%. Gannett Co. pays out -3,200.0% of its earnings in the form of a dividend.
This is a summary of current recommendations for Gannett Co. and Pearson, PLC, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Gannett Co. currently has a consensus target price of $16.00, indicating a potential upside of 78.57%. Given Gannett Co.’s stronger consensus rating and higher possible upside, equities analysts clearly believe Gannett Co. is more favorable than Pearson, PLC.
This table compares Gannett Co. and Pearson, PLC’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
Gannett Co. has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Pearson, PLC has a beta of 0.26, suggesting that its stock price is 74% less volatile than the S&P 500.
Gannett Co. beats Pearson, PLC on 8 of the 14 factors compared between the two stocks.
Gannett Co. Company Profile
Gannett Co., Inc. is a media company. The Company operates as a newspaper publisher in the United States. As of December 25, 2016, it owned ReachLocal, Inc. (ReachLocal), a digital marketing solutions company; the USA TODAY NETWORK (made up of USA TODAY including digital sites and affiliates (USAT) and 109 local media organizations in 34 states in the United States and Guam), and Newsquest Media Group Ltd. (Newsquest), the Company’s subsidiary operating in the United Kingdom. The Company’s segments include Publishing, ReachLocal, and a Corporate and Other category. The publishing segment comprises the USA TODAY NETWORK and Newsquest. Its publishing operations also include commercial printing and distribution, marketing and data services. It also reaches small and medium sized businesses with digital marketing solutions principally through ReachLocal. ReachLocal is focused on local businesses and on providing a total digital marketing solution.
Pearson, PLC Company Profile
Pearson plc (Pearson) is a learning company. The Company delivers learning through providing a range of educational products and services to institutions, governments, professional bodies and individual learners. The Company operates through three segments, which include North America, Core and Growth. The Company’s North America segment includes Courseware, Assessments and Services businesses in the United States and Canada. The Company’s Core segment includes Courseware, Assessments and Services businesses in more mature markets including the United Kingdom, Australia and Italy. The Company’s Growth segment includes Courseware, Assessments and Services businesses in emerging markets including Brazil, China, India and South Africa. The Company provides content, assessment and digital services to schools, colleges and universities, as well as professional and vocational education to learners to help increase their skills and employability prospects.
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