Gannett (GCI) AI Stock Analysis

• Market Cap: $542.48M
• Dividend Yield: N/A
• Average Volume (3M): 1.20M
• Price to Earnings (P/E): 5.4
• Beta (1Y): 0.86
• Revenue Growth: -8.00%
• EPS Growth: N/A
• Country: US
• Employees: 11,700
• Sector: Communication Services
• Sector Strength: 97
• Industry: Publishing
• EPS (TTM): 0.45
• Shares Outstanding: 146,617,080
• 10 Day Avg. Volume: 1,382,087
• 30 Day Avg. Volume: 1,204,196
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 3.30
• Enterprise Value/Revenue: 0.75
• Enterprise Value/Gross Profit: 1.98
• Enterprise Value/Ebitda: 7.03
• 1Y Price Target: $5.58
• Price Target Upside: 58.97% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 55 Neutral
• Price Target: $4.00 ▲(13.96% Upside)

Gannett's overall stock score reflects a company facing significant financial challenges, particularly in revenue and profitability. While there are positive signs in technical analysis and valuation, and strategic initiatives from the earnings call, the high leverage and mixed cash flow performance weigh heavily on the overall assessment.

Positive Factors

Digital Advertising Revenue Growth

The growth in digital advertising revenue indicates Gannett's successful adaptation to digital trends, enhancing its competitive position in the digital media landscape and providing a more sustainable revenue stream.

Strategic AI Content Licensing Agreement

This agreement is likely to generate new revenue streams through licensing fees and advertising revenue share, leveraging AI to enhance content value and distribution efficiency, aligning with technological advancements.

Debt Reduction

Significant debt reduction strengthens the balance sheet, reduces financial risk, and enhances financial flexibility, positioning Gannett for future investments and growth opportunities.

Negative Factors

Overall Revenue Decline

The decline in overall revenue reflects ongoing challenges in Gannett's core business, potentially impacting its ability to invest in growth initiatives and maintain market share.

High Leverage

High leverage indicates financial risk and limits Gannett's capacity to maneuver financially, potentially affecting long-term stability and investment capacity.

Declining Free Cash Flow

Declining free cash flow suggests challenges in cash generation, which could constrain Gannett's ability to fund operations, pay down debt, or invest in growth opportunities.

Gannett Business Overview & Revenue Model

Company Description

Gannett Co., Inc. operates as a media and marketing solutions company in the United States. It operates through two segments, Publishing and Digital Marketing Solutions. The company's principal products include 230 daily print media with total paid circulation of approximately 1.9 million and Sunday circulation of 2.2 million; 249 weekly print media with total circulation of approximately 1.4 million; and 292 locally-focused websites. Its principal products also comprise 123 daily and weekly news media brands and approximately 80 magazines, and related digital platforms; sports network, as well as Reviewed.com, an affiliate marketing service; and USA TODAY NETWORK, a community events platform. The company also offers digital marketing solutions, such as online presence solutions, online advertising products, conversion software, and cloud-based software solutions. In addition, it produces niche publications that address specific local market interests, such as recreation, sports, healthcare, and real estate. Further, the company offers local market news and information, as well as advertising and subscriptions, and commercial printing and distribution services; and prints commercial materials, including flyers, business cards, and invitations. The company was formerly known as New Media Investment Group Inc. and changed its name to Gannett Co., Inc. in November 2019. Gannett Co., Inc. was incorporated in 2013 and is headquartered in McLean, Virginia.

How the Company Makes Money

Gannett generates revenue through multiple streams, primarily focusing on advertising and subscription services. The company's advertising revenue comes from both print and digital sources, where it provides businesses with targeted advertising solutions through its extensive reach and audience data. Additionally, Gannett earns money through digital subscriptions, offering readers access to premium content on its online platforms. The company has also expanded its revenue model by providing marketing services, including digital marketing and social media management, to local businesses. Strategic partnerships with technology firms and collaborations with other media outlets further bolster its revenue capabilities, allowing Gannett to leverage new technologies and expand its audience engagement.

Gannett Financial Statement Overview

Summary

Gannett's financial statements indicate challenges with declining revenue and profitability pressures. High leverage poses financial risks, despite a strong ROE. Declining cash flows and high debt levels weaken overall financial health.

Income Statement

Gannett's income statement shows a declining revenue trend with a negative revenue growth rate of -2.25% in the TTM. Gross profit margin remains moderate at 37.75%, but the net profit margin is relatively low at 4.84%. The EBIT and EBITDA margins are also modest, indicating challenges in operational efficiency. Overall, the income statement reflects a company struggling with revenue contraction and profitability pressures.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 4.97, indicating significant leverage and potential financial risk. Return on equity is strong at 59.28%, suggesting effective use of equity to generate profits. However, the equity ratio is low, highlighting a reliance on debt financing. The balance sheet suggests financial instability due to high leverage, despite a strong ROE.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth by -15.47% in the TTM, reflecting cash generation challenges. The operating cash flow to net income ratio is 0.18, indicating moderate cash flow efficiency. The free cash flow to net income ratio is 0.44, suggesting some ability to convert income into cash. Overall, cash flow performance is mixed, with concerns over declining free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.39B	2.51B	2.66B	2.95B	3.21B	3.41B
Gross Profit	902.19M	963.73M	971.52M	1.08B	1.31B	1.37B
EBITDA	254.23M	183.31M	261.53M	289.52M	478.86M	-263.12M
Net Income	115.72M	-26.35M	-27.79M	-78.25M	-136.17M	-672.40M
Balance Sheet
Total Assets	2.01B	2.04B	2.18B	2.39B	2.83B	3.11B
Cash, Cash Equivalents and Short-Term Investments	88.54M	106.30M	100.18M	94.25M	130.76M	170.72M
Total Debt	1.18B	1.29B	1.29B	1.38B	1.49B	1.87B
Total Liabilities	1.77B	1.89B	1.86B	2.10B	2.30B	2.74B
Stockholders Equity	237.09M	153.14M	317.79M	295.74M	532.10M	364.11M
Cash Flow
Free Cash Flow	43.18M	50.78M	56.46M	-4.60M	87.89M	20.80M
Operating Cash Flow	98.60M	100.31M	94.57M	40.78M	127.45M	57.77M
Investing Cash Flow	16.12M	-27.95M	46.98M	22.12M	70.65M	160.14M
Financing Cash Flow	-127.49M	-68.85M	-135.51M	-102.87M	-261.17M	-201.34M

Gannett Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.51
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GCI, the sentiment is Negative. The current price of 3.51 is below the 20-day moving average (MA) of 4.15, below the 50-day MA of 4.14, and below the 200-day MA of 3.89, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 24.95 is Positive, neither overbought nor oversold. The STOCH value of 5.07 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GCI.

Gannett Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NYT	70 Outperform	$8.90B	28.14	17.13%	1.23%	7.82%	19.39%
SSP	62 Neutral	$200.52M	4.67	8.30%	―	5.25%	―
GTN	61 Neutral	$531.04M	3.09	7.23%	6.87%	7.03%	1727.49%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
GCI	55 Neutral	$542.48M	5.41	47.54%	―	-8.00%	―
DALN	50 Neutral	$78.24M	2.66	-24.74%	3.60%	-8.00%	-46.22%
LEE	49 Neutral	$27.12M	―	―	―	-5.68%	-127.26%

Gannett Corporate Events

Gannett Stockholders Elect Directors at Annual Meeting

At the Annual Meeting of Stockholders held on June 2, 2025, Gannett Co., Inc. stockholders elected nine directors to serve until the 2026 meeting and ratified the appointment of Grant Thornton LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025. However, stockholders did not approve several proposals to amend the company’s bylaws and charter, including those aimed at eliminating supermajority voting requirements, which would have required an 80% affirmative vote.