The New York Times (NYT), established in 1851 as a penny paper appealed to an intellectual readership and is now “friends” with social media by participating in the debut of Facebook News on October 26, 2019. the Times Facebook News articles will be chosen partly by Facebook and also personalized based on news users prefer. Facebook is paying some publishers $1 Million to $3 Million and making multi-year financial commitments.
Lore has it that in the heyday of newpapers, the first paperboy in 1833 was 10 year old Barney Flaherty for the New York Sun. The world’s oldest Paperboy Statute was erected in 1895 in great Barrington, Massachusetts.
While President Trump tweets New York Times is a failing company and tells Federal agencies to cut Times subscriptions; Times’ earnings say otherwise. Their stock trades around $30.00 per share, up about 32% year to date. So, for trading stock options, the paper has not been a money-loser. New York Times shares will rise quicker than the market in times of optimism, but fall faster in times of pessimism.
Advertising remains a significant source of revenue for the Times. However, readers’ preference for accessing news online, mostly free, has diminished the industry’s print-advertising model.
Though the Times total advertising revenue improved 1.3% year over year in 2019; the Times anticipates digital advertising revenue to be a challenge in the future. Paid digital subscribers reached 3,700,000, improving 30.7%. Trimmed print operations lead the way for online publications and the pay-and-read model to affect their bottom line with opportunities for trading options.
New York Times Co. is a fairly large company, with a market capitalization of $4.8 Billion, which means it is probably on the radar of most investors; at the same time, it takes deep pockets to influence the stock price of a large company. Since the Times’ stock price tends to move in tandem with the market, when considering stock option trades, thought should be given to the overall direction of the stock market.
Zooming in on the Times’ stock options; they are diversifying business, adding new revenue streams, realigning cost structure and streamlining operations. They’re making steady progress toward their goal of reaching 10 Million subscriptions by 2025, with continued investment into growing the subscription business; all indications of growth and stock option opportunities.
Are You a Bull or Bear ?
Date: October 27, 2019 – Stock: NewYork Times – Share price closed @$31.18
If you’re a Bullish Mom and think New York Times will go up, try the January 17, 2020 Expiration Date – CALL $30.00 Bid; and $29.00 Strike Ask strike prices. Premium is $.85¢ (mid @.61¢) debit to pay = Long Call Vertical Spread on www.TDAmeritrade.com
On the other hand, Mom, if you think New York Times is bearish and will go down, try the Expiration Date: January 17, 2020 – PUT $30.00 Ask; and $29.00 Bid strike prices. Premium is $.45¢ (mid .33¢) debit to pay = Long Put Vertical Spread on www.TastyWorks.com