Critical Analysis: New Media Investment Group (NEWM) and Wolters Kluwer (WTKWY)

New Media Investment Group (NYSE: NEWM) and Wolters Kluwer (OTCMKTS:WTKWY) are both consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, dividends, valuation, risk, institutional ownership, analyst recommendations and earnings.

Earnings and Valuation

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This table compares New Media Investment Group and Wolters Kluwer’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
New Media Investment Group $1.34 billion 0.69 -$910,000.00 ($0.02) -875.50
Wolters Kluwer $5.00 billion 3.04 $756.85 million N/A N/A

Wolters Kluwer has higher revenue and earnings than New Media Investment Group.

Insider & Institutional Ownership

80.1% of New Media Investment Group shares are held by institutional investors. Comparatively, 0.1% of Wolters Kluwer shares are held by institutional investors. 5.3% of New Media Investment Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for New Media Investment Group and Wolters Kluwer, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
New Media Investment Group 0 0 1 0 3.00
Wolters Kluwer 0 0 0 0 N/A

Dividends

New Media Investment Group pays an annual dividend of $1.48 per share and has a dividend yield of 8.5%. Wolters Kluwer pays an annual dividend of $0.77 per share and has a dividend yield of 1.5%. New Media Investment Group pays out -7,400.0% of its earnings in the form of a dividend. Wolters Kluwer has increased its dividend for 3 consecutive years.

Risk and Volatility

New Media Investment Group has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500. Comparatively, Wolters Kluwer has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500.

Profitability

This table compares New Media Investment Group and Wolters Kluwer’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
New Media Investment Group -0.07% 4.18% 2.27%
Wolters Kluwer N/A N/A N/A

Summary

New Media Investment Group beats Wolters Kluwer on 8 of the 13 factors compared between the two stocks.

About New Media Investment Group

New Media Investment Group Inc. is a holding company. The Company owns, operates and invests in local media assets. The Company’s segments include Eastern US Publishing, Central US Publishing, Western US Publishing and BridgeTower. It focuses on owning and acquiring local media assets in small to mid-size markets. It is a publisher of local newspapers and related publications. As of December 25, 2016, its portfolio of media assets spanned across 538 markets and 36 states. As of December 25, 2016, its products included 631 community print publications, 538 Websites and two yellow page directories. Its directory portfolio includes Surewest Directories located in and around the Sacramento, California area, primarily in Roseville, California. The Roseville directory serves the local Roseville community. It also owns additional directory based in Mt. Shasta, California. Propel is its business services product line with digital products designed for small and midsized businesses (SMBs).

About Wolters Kluwer

Wolters Kluwer N.V. provides information, software and services to doctors, nurses, accountants, lawyers, and audit, compliance and regulatory professionals. The Company’s segments include Health; Tax & Accounting; Governance, Risk & Compliance, Legal & Regulatory and Corporate. Its geographical segments include the Netherlands, Europe, North America and the Rest of the World. Its Health solutions help facilitate evidence-based decision-making in clinical, nursing, and pharmaceutical settings. The Tax & Accounting segment offers solutions in compliance, collaboration, internal and external audit management, and firm management. The Governance, Risk & Compliance segment offers solutions ranging from legal compliance and enterprise-wide legal management, to address regulatory and industry requirements through workflow, analytics, and reporting solutions and services in financial markets. The Legal & Regulatory segment provides information, analytics, software and workflow solutions.

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