The Wall Street Journal's New Metro Section Might Mean A 15% Downside For The New York Times' Stock

Here’s a fun little game.

It’s an interactive New York Times ad market forecaster created by the geeky social-networking/stock-valuation website Trefis, which has made some predictions about—yes, you guessed it!—the ongoing pissing match between The Times and The Wall Street Journal:

The New York Times (NYSE:NYT) recently reported a 12% year-over-year decline in its print advertising business for Q1 of 2010 compared to same period last year, primarily as a result of the on-going macroeconomic declines in the broader ad market.  Furthermore, the company is facing rising competitive pressure from News Corp’s (NASDAQ:NWS) Wall Street Journal (WSJ) which is launching a NYC metro edition and aggressively luring new advertisers.

We estimate that the print advertising business constitutes a third of the $11 Trefis price estimate for NYT’s stock, making it the most valuable business for the New York Times (NYT).   There could be a downside of 15% to the Trefis price estimate if NYT’s US print ad market share were to stagnate around 11% as a result of greater competition from the WSJ rather than increasing to 16% share as we forecast.

The battle rages on!

(Thanks to FishbowlNY for pointing us to the link.)

Now try this thing out for yourself. Just drag the trend line to get varying calculations of The Times’ forecasted revenues and profits.

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