Cash would invest in Edipresse
Media companies are failing to impress stock market investors due to declining advertising revenue. However, media companies pursuing expansion, such as Edipresse, do have a future.
Due to falling advertising revenues, media titles are not inspiring stock market players. Expansive media companies such as Edipresse have a future, however. The Lausanne-based media company is on the rise. Even though the share price is still more than half below its high from the year 2000, the business magazine Cash recommends buying it. Analysts estimate Edipresse's profit for 2005 at CHF 35 million - a figure very close to that of 2000. According to Cash, this is due on the one hand to the flourishing foreign business, which now accounts for almost half of sales, and on the other to the strong French-speaking Swiss titles such as Le Matin, 24 Heures and Bilan. Although the struggle between the free newspaper Le Matin Bleu and the Tamedia title 20 Minutes continues, experts see the regional roots of the Lausanne-based company as promising. Above all, however, they see great potential in the international and online business. Bank Vontobel believes that the media company will achieve average profit growth of 10 percent in both 2006 and 2007. The Edipress share is valued favorably by historical standards, but could experience a real boost if the Swiss advertising market improves. The only drawback: as a large proportion of the shares are family-owned, trading is not very liquid.
