CINCINNATI - The E.W. Scripps Company (NASDAQ: SSP), a diversified media conglomerate, announced today that it has successfully navigated the recent global IT outage with limited impact on its operations. The company, which owns more than 40 local news outlets and national networks such as ION and Scripps News, experienced only a brief interruption in its broadcasting services.
According to the company's statement, Scripps News was off the air for a mere 10 minutes due to the outage. While the outage did affect Scripps, the majority of its local stations were able to maintain their broadcast operations without going completely off the air. By early morning, nearly all stations had resumed airing local news, and by noon, all were back to broadcasting as usual.
The timing of the IT incident, occurring overnight, along with the company's effective response, meant that Scripps' advertising revenue did not suffer a significant hit. This swift recovery highlights Scripps' preparedness for such disruptions and its commitment to providing continuous news coverage.
Scripps operates a considerable number of TV stations across the United States and is known for its objective journalism and national news coverage through outlets like Scripps News and Court TV. The company also manages a range of entertainment brands, including ION, Bounce, Grit, ION Mystery, and Laff. As the largest holder of broadcast spectrum in the country, Scripps also oversees the annual Scripps National Spelling Bee.
This resilience in the face of a widespread technology failure underscores the robustness of Scripps' operational capabilities. The information for this report is based on a press release statement from The E.W. Scripps Company.
In other recent news, E.W. Scripps Company reported better-than-expected results for the first quarter of 2024, with a notable 13% increase in revenue across its Local Media division. The company is actively pursuing debt reduction through strategic sales, including the potential divestiture of the Bounce TV network and select real estate assets. Jeff Kiernan, a veteran in journalism, has been promoted to the role of vice president of local news, a move that underscores Scripps' commitment to evolving its news delivery.
In analyst notes, Wells Fargo adjusted its price target for Scripps, reducing it due to an estimation of a decline in core advertising revenue. However, Guggenheim maintained a neutral stance on Scripps shares after reviewing the company's first-quarter results and management's second-quarter outlook. Both firms anticipate challenges due to continued advertising pressure but also foresee modest growth in retransmission and a robust political advertising climate.
These developments highlight Scripps' strategic moves to enhance its operations and navigate the dynamic media landscape. The company's focus on reducing debt, optimizing capital structure, and leveraging political advertising are key strategies for increasing EBITDA and ensuring a robust performance in the coming quarters.
InvestingPro Insights
The E.W. Scripps Company (NASDAQ: SSP) has demonstrated operational resilience following a global IT outage, which aligns with the company's current financial health and market position as reflected in recent InvestingPro data. With a market capitalization of 281.36 million USD, Scripps is positioned in the market as a smaller-cap company that has shown notable price movements in recent times.
InvestingPro data shows that Scripps has experienced a strong return over the last month, with a 59.61% increase in price total return, indicating a potential recovery or positive investor sentiment following a period of volatility. Despite this recent uptick, the stock has seen a significant decline over the past year, with a 68.6% decrease in price total return, highlighting the stock's volatility which is also reflected in its low Price / Book multiple of 0.37.
An InvestingPro Tip suggests that Scripps is trading at a low Price / Book multiple, which could indicate that the stock is undervalued relative to its assets. This could be of interest to value investors looking for potential opportunities. Additionally, the company's strong free cash flow yield, as implied by valuation, is another positive aspect for investors seeking companies with the potential for cash generation.
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