Internet Traffic at NYTimes.com Could Accelerate
New York Times (NYSE:NYT) competes with both print and online news services of companies like News Corp (NASDAQ:NWS), Yahoo (NASDAQ:YHOO), Google (NASDAQ:GOOG), and Microsoft (NASDAQ:MSFT).
The average number of monthly unique visitors to NYTimes.com and IHT.com has risen over 20% in the past two years. We expect further growth in this metric in the years ahead, although at a slower pace, led by increasing internet penetration and a surge in the number of connected digital devices.
While we expect the number of monthly unique visitors to reach 54 million by the end of the Trefis forecast period, Trefis community members expect this number to cross 62 million, suggesting 5% upside to our price estimate for NYT stock.
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We currently have a price estimate of $8.46 for New York Times stock, implying downside to market price.
Rising Internet Penetration
NYTimes.com is one of the most popular news websites in the U.S., and we anticipate that this popularity will increasingly draw more users to the site. Growing global internet penetration, coupled with faster broadband speeds, should also facilitate continued increases in traffic at International Herald Tribune (IHT.com).
Surge in Growth of Connected Digital Devices
The growth in broadband users and internet penetration has brought a corresponding rise in the number of connected digital devices like smartphones, handhelds, e-readers and tablet PCs. One study from consulting firm Bain & Company suggests that price reductions, technological advancements and improvement in user experience will drive accelerating growth in this market. [1] The study also forecasts that roughly 15% to 20% of the global population will be using a digital reader, tablet or other comparable device by 2015.
Trefis Community Forecast
Trefis community members forecasts that monthly unique visitors at NYTimes.com will increase from about 33 million in 2010 to 63 million by the end of the Trefis forecast period, compared to the baseline Trefis estimate of an increase towards 54 million during the same period. The member estimates imply an upside of 5% to the Trefis price estimate for New York Times stock.
Drag the trend line in the modifiable chart above to see how various NYTimes.com unique visitor trends could affect the value of New York Times stock.
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See our complete analysis for New York Times stock here.
Notes:- Readers Are Ready For The Shift To Digital, Bain & Company press release, Nov 6, 2010 [↩]