Time Inc’s shares fall the most in two weeks on Wednesday, magazine publisher cuts dividend as quarterly sales shrink

On May 10th Time Inc cut its dividend, as the company continued with a recently announced strategic plan involving reductions in spending and a focus on digital business, which followed the publisher’s decision not to sell itself.

Time Incs shares registered their largest daily loss since April 28th during Wednesdays trading session. The stock went down 14.24% ($2.15) to $12.95, after touching an intraday low at $12.25, or a price level not seen since February 11th 2016 ($12.23). In the week ended on May 7th the shares of the magazine publisher lost 0.99% of their market value compared to a week ago, which marked a second consecutive period of decline. The stock has extended its loss to 14.80% so far during the current month, following a 21.45% slump in April. The latter has been the sharpest monthly retreat in more than 24 months. For the entire past year, Time Incs shares gained 13.91%.

Time Inc’s decision not to sell itself put an end to speculation regarding a potential merger with Meredith Corporation, a broadcasting and publishing group.

”The noise and relentless media speculation over the last 6 months around the potential change of ownership clearly was a major distraction to our employees and advertisers and other partners, and had an impact on Q1 results”, Richard Battista, Time’s Chief Executive Officer, was quoted as saying by Reuters.

Total revenue was reported to have shrunk almost 8% to $636 million during the quarter ended on March 31st, which marked a fourth consecutive three-month period of decrease.

Time’s print advertising revenue dropped almost 21% to $212 million during the recent quarter, while revenue from digital advertising went up 32% to reach $119 million.

The publisher said that it would discontinue providing annual revenue forecasts.

At the same time, quarterly dividend was slashed to $0.04 per share from $0.19 per share.

Net loss attributable to shareholders was reported to have increased to $28 million ($0.29 per share) during the quarter ended on March 31st from $10 million ($0.10 per share) during the same period a year ago.

Time Inc’s quarterly loss, excluding special items, was reported at $0.18 per share, which exceeded the median analyst estimate, pointing to a loss of $0.15 per share, according to Thomson Reuters I/B/E/S.

According to CNN Money, the 4 analysts, offering 12-month forecasts regarding Time Inc’s stock price, have a median target of $20.50, with a high estimate of $24.00 and a low estimate of $17.00. The median estimate is a 58.30% surge compared to the closing price of $12.95 on May 10th.

The same media also reported that 4 out of 6 surveyed investment analysts had rated Time Inc’s stock as “Buy”, while 2 – as “Hold”.

Daily and Weekly Pivot Levels

With the help of the Camarilla calculation method, todays levels of importance for the Time Incs stock are presented as follows:

R1 – $13.10
R2 – $13.25
R3 (Range Resistance – Sell) – $13.40
R4 (Long Breakout) – $13.86
R5 (Breakout Target 1) – $14.39
R6 (Breakout Target 2) – $14.70

S1 – $12.80
S2 – $12.65
S3 (Range Support – Buy) – $12.50
S4 (Short Breakout) – $12.04
S5 (Breakout Target 1) – $11.51
S6 (Breakout Target 2) – $11.20

By using the traditional method of calculation, the weekly levels of importance for Time Inc (TIME) are presented as follows:

Central Pivot Point – $15.12
R1 – $15.43
R2 – $15.82
R3 – $16.13
R4 – $16.45

S1 – $14.73
S2 – $14.42
S3 – $14.03
S4 – $13.65