Strong Q4 for Newspapers, Mags Lead to Improvement in ‘10

Following an influx of ad money in the fourth quarter of 2009, Wells Fargo securities analyst John Janedis upgraded the New York Times Co. from underperform to market perform, and Gannett Co. to outperform, from underperform.

Wells Fargo has also recently upgraded News Corp from market perform to outperform.

Janedis expects newspaper advertising for the year to decline by high single-digits - good news for the industry when compared with the 30% decline in ad revenues the industry saw for much of the year, reports the Wall Street Journal.

The Wall Street Journal and The New York Times, in particular, performed well in the latter half of the year, as advertisers released funds after having spent only sparingly earlier in the year. Both are expected to post gains in ad pages of 20% in Q4. Financial, domestic automotive and telecom increased as much as 75% in the fourth quarter.

Magazines, too, saw some increases at the end of 2009, and some executives believe the first quarter of 2010 will be flat compared to last year, an improvement over the 21.6% decline national magazines saw in ad spending through the first nine months of 2009 (per Nielsen).

March, a particularly important month for magazines because that is when fashion and retail advertisers start to spend, is looking good for Conde Nast publications including Glamour, with ad pages for that magazine expected to be up 6% to 7% for the month. Vogue was up 3% in February, and the magazine’s March, April and May issues are also tracking up, though it’s too soon to tell for certain at this point.

ZenithOptimedia predicts that global ad spending will be up 0.9% this year, while GroupM predicts a similar 0.8% growth. Global spending on magazines is expected to decline 4.5%, per Zenith.