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Nielsen (NLSN) Q4 Earnings and Revenues Surpass Estimates
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Nielsen Holdings plc reported fourth-quarter 2020 adjusted net earnings of 53 cents per share, which surpassed the Zacks Consensus Estimate of 46 cents. Also, the bottom line was up 29.3% from the year-ago quarter.
Total revenues came in at $1.67 billion, which declined 1.1% year over year. Also, the figure declined 1.8% on a constant-currency basis.
However, the top line surpassed the Zacks Consensus Estimate of $1.62 billion.
Nielsen Holdings Plc Price, Consensus and EPS Surprise
Nielsen Global Media: The company generated revenues of $872 million (accounting for 52% of total revenues) from this segment, reflecting a decline of 1.9% from the year-ago level or 2.6% on a constant-currency basis.
We note that Audience Measurement revenues increased 0.2% year over year to $624 million.
However, Plan/Optimize revenues were $248 million, which decreased 6.8% year over year due to the COVID-19 pandemic.
Nielsen Global Connect: It generated revenues of $800 million (48% of total revenues), reflecting a 0.2% decline from the year-ago period. Also, the figure decreased 0.9% on a constant-currency basis.
Revenues in Measure came in at $548 million, increasing 0.4% year over year. However, Predict/Activate revenues decreased 1.6% from the year-ago quarter to $252 million.
Operating Results
Adjusted EBITDA was $560 million for the fourth quarter, up 13.8% from the prior-year level. Adjusted EBITDA margin expanded 439 basis points to 33.5%. The increase reflected the measures taken during the quarter and benefits of permanent cost actions from the optimization plan.
Nielsen’s selling, general and administrative expenses were $455 million, decreasing 8.8% from the year-ago figure.
Operating income was $166 million for the quarter, down 25.9% year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2020, cash and cash equivalent balance was $610 million, down from $2.3 billion on Sep 30, 2020.
At fourth quarter-end, gross debt was $8.3 billion compared with $10 billion at the end of the prior quarter. Net debt (gross debt excluding cash and cash equivalents) was $7.7 billion and net debt leverage ratio was 4.09 at the end of the reported quarter.
Cash flow from operations decreased to $337 million from $470 million in the prior-year quarter. Further, capex totaled $174 million and free cash flow decreased from the year-ago level to $225 million for the fourth quarter.
2021 Guidance
The company provided its 2021 guidance on a constant-currency basis.
Revenues are expected to increase in the range of 2-3%. Organic revenue growth is expected to increase in the range of 3.5-4.5%.
Adjusted EBITDA is anticipated in the range of $1.460-$1.480 billion. Meanwhile, adjusted EBITDA margin is expected within 42.25-42.5%.
Additionally, Nielsen expects free cash flow in the range of $580-$630 million. Further, adjusted earnings are expected between $1.43 and $1.54 per share.
Long-term earnings growth for Semtech, KLA Corp., and Facebook is currently projected at 12.5%, 11.6%, and 19.2%, respectively.
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Nielsen (NLSN) Q4 Earnings and Revenues Surpass Estimates
Nielsen Holdings plc reported fourth-quarter 2020 adjusted net earnings of 53 cents per share, which surpassed the Zacks Consensus Estimate of 46 cents. Also, the bottom line was up 29.3% from the year-ago quarter.
Total revenues came in at $1.67 billion, which declined 1.1% year over year. Also, the figure declined 1.8% on a constant-currency basis.
However, the top line surpassed the Zacks Consensus Estimate of $1.62 billion.
Nielsen Holdings Plc Price, Consensus and EPS Surprise
Nielsen Holdings Plc price-consensus-eps-surprise-chart | Nielsen Holdings Plc Quote
Segments Details
Nielsen Global Media: The company generated revenues of $872 million (accounting for 52% of total revenues) from this segment, reflecting a decline of 1.9% from the year-ago level or 2.6% on a constant-currency basis.
We note that Audience Measurement revenues increased 0.2% year over year to $624 million.
However, Plan/Optimize revenues were $248 million, which decreased 6.8% year over year due to the COVID-19 pandemic.
Nielsen Global Connect: It generated revenues of $800 million (48% of total revenues), reflecting a 0.2% decline from the year-ago period. Also, the figure decreased 0.9% on a constant-currency basis.
Revenues in Measure came in at $548 million, increasing 0.4% year over year. However, Predict/Activate revenues decreased 1.6% from the year-ago quarter to $252 million.
Operating Results
Adjusted EBITDA was $560 million for the fourth quarter, up 13.8% from the prior-year level. Adjusted EBITDA margin expanded 439 basis points to 33.5%. The increase reflected the measures taken during the quarter and benefits of permanent cost actions from the optimization plan.
Nielsen’s selling, general and administrative expenses were $455 million, decreasing 8.8% from the year-ago figure.
Operating income was $166 million for the quarter, down 25.9% year over year.
Balance Sheet & Cash Flow
As of Dec 31, 2020, cash and cash equivalent balance was $610 million, down from $2.3 billion on Sep 30, 2020.
At fourth quarter-end, gross debt was $8.3 billion compared with $10 billion at the end of the prior quarter. Net debt (gross debt excluding cash and cash equivalents) was $7.7 billion and net debt leverage ratio was 4.09 at the end of the reported quarter.
Cash flow from operations decreased to $337 million from $470 million in the prior-year quarter. Further, capex totaled $174 million and free cash flow decreased from the year-ago level to $225 million for the fourth quarter.
2021 Guidance
The company provided its 2021 guidance on a constant-currency basis.
Revenues are expected to increase in the range of 2-3%. Organic revenue growth is expected to increase in the range of 3.5-4.5%.
Adjusted EBITDA is anticipated in the range of $1.460-$1.480 billion. Meanwhile, adjusted EBITDA margin is expected within 42.25-42.5%.
Additionally, Nielsen expects free cash flow in the range of $580-$630 million. Further, adjusted earnings are expected between $1.43 and $1.54 per share.
Zacks Rank & Key Picks
Nielsen currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Semtech Corporation (SMTC - Free Report) , KLA Corporation (KLAC - Free Report) and Facebook , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth for Semtech, KLA Corp., and Facebook is currently projected at 12.5%, 11.6%, and 19.2%, respectively.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>