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The Zacks Analyst Blog Highlights: News Corp., Amazon.com, New York Times, IAC/InterActive and Mondelez International

Zacks Equity Research

For Immediate Release

Chicago, IL – September 5, 2013 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the News Corporation (NWSA- Free Report), Amazon.com Inc (AMZN- Free Report), The New York Times Company (NYT- Free Report), IAC/InterActiveCorp (IACI- Free Report) and Mondelez International, Inc. (MDLZ- Free Report).

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Here are highlights from Wednesday’s Analyst Blog:

News Corp Divests Dow Jones Local Media

In order to focus more on its core businesses, News Corporation (NWSA- Free Report) disclosed the sale of the Dow Jones Local Media Group to an affiliate of Fortress Investment Group LLC for an undisclosed amount.

The Dow Jones Local Media Group operates 33 publications, which include 8 daily and 15 weekly newspapers. The sale of the Dow Jones Local Media Group entitles Fortress Investment to the ownership of other newspaper franchises that include the Times Herald-Record, The Record, Cape Cod Times, The Herald, The Standard-Times, The Pocono Record, The Daily Tidings and The Mail Tribune.

This deal comes in the midst of a rapidly changing media landscape where publishing companies have been offloading assets that bear no direct relation with the core operations.

In fact, the publishing industry as a whole has been struggling in terms of revenues and readership due to the increasing availability of online news. This has rendered the print-advertising model increasingly irrelevant.

Recently, Amazon.com Inc’s (AMZN
- Free Report) founder and CEO, Jeff Bezos purchased one of the legendary publications in American journalism, The Washington Post for $250 million in cash, while The New York Times Company (NYT- Free Report) sold the Boston Globe to Red Sox owner John Henry and IAC/InterActiveCorp (IACI- Free Report) divested the Newsweek brand to IBT Media, the publisher of the International Business Times.

News Corporation on the other hand divided its operations into 2 separate publicly traded publishing and entertainment entities. The publishing company comprises publishing businesses, education unit and the integrated marketing services business, while, the entertainment company includes cable and television assets, filmed entertainment, and direct satellite broadcasting businesses.
Currently, News Corporation holds a Zacks Rank #4 (Sell).

Mondelez to Restructure Supply Chain
Mondelez International, Inc. (MDLZ
- Free Report) recently discussed its strategies to restructure its supply chain in order to drive long-term growth at the Barclays Capital Back to School Consumer Conference. The restructuring of its supply chain is expected to generate $3 billion in gross productivity savings, $1.5 billion in net productivity and $1 billion in incremental cash over the next three years. These savings are expected to generate 60 to 90 basis points annual increase in operating margin.  

The company intends to reinvent its supply chain strategies by upgrading its managerial talents, manufacturing process and developing partnerships with suppliers to improve efficiency. For instance, the company is installing Oreo manufacturing lines, which would require 30% less capital and thereby reduce operating costs significantly. The company further plans to expand these transformation initiatives to other categories like biscuits, chocolate and gum. The company also intends to drive its volume and revenue growth by investing in 14 greenfield plants by 2020.

Mondelez International intends to use margin growth in the developed markets of Europe and North America to boost growth investments in emerging markets.

In North America, MDLZ expects to generate 500 basis points (bps) expansion in operating margin by 2016, a year earlier than previously guided, on the back of new production lines and a revamped supply chain network. In Europe, the company targets 250 bps expansion in operating margin by 2016 by streamlining its supply chain and reducing overhead costs.

Mondelez International reaffirmed its fiscal 2013 organic net revenue growth guidance, at the low end of long-term targets of 5% to 7%. Adjusted earnings per share are expected to be in the range of $1.55 to $1.60.   

Mondelez International carries a Zacks Rank #3 (Hold).
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