Scripps Networks' Margins Improve: Can SSP Stock Sustain the Momentum?

Yahoo

a day ago

The E.W. Scripps Company SSP has been benefiting from its Scripps Networks division, which has emerged as a key driver of margin improvement, supported by disciplined cost control and targeted sports programming. Partnerships with the NWSL and WNBA are expected to further drive both revenues and margin performance in the second and third quarters of 2025. To sustain growth, Scripps is expanding its women's sports line-up with new distribution agreements, such as the SI Women's Games and the Fort Myers Tip-off, which are scheduled for the fourth quarter.
For the second quarter, the division's revenues are expected by the company to remain roughly flat, while expenses are projected to decline in the low double digits. SSP reaffirmed its 2025 target of 400-600 basis points of margin expansion but noted that its first-quarter results have already exceeded that range due to early execution of cost-saving measures.
Building on the strength of strong ad sales execution and cost savings announced in the fourth quarter of 2024, the company posted its highest network margins in the first quarter of 2025 since the fourth quarter of 2022.
In the first quarter, the Scripps Networks division reported $198 million in revenues, down 5.4% year over year, contributing 37.8% of total revenues. Segment profit rose to $64.1 million from $49.7 million in the year-ago quarter, driven by a 16% reduction in expenses. These efforts lifted segment margin to 32%, the highest since late 2022.
The E.W. Scripps Company is competing against major players like Nexstar Media Group NXST and Sinclair SBGI in the national network and CTV space.
Nexstar Media Group is expanding its national TV sports lineup through branded content, including the new 'Mobil 1 Victory Lane' segment on The CW's NASCAR Xfinity Series broadcasts, strengthening Nexstar Media Group's advertiser appeal in live sports.
Sinclair's multicast networks, CHARGE, COMET, ROAR and The Nest, have posted record growth driven by anchor series acquisitions, rebranding efforts and fan-focused multi-platform events like COMET FEST and CHARGECON. With expanded distribution in top national TV markets and growing availability on CTV platforms, Sinclair now operates the fastest-growing network group in the free TV space.
SSP shares have rallied 50.2% in the year-to-date (YTD) period, outperforming the Zacks Broadcast Radio and Television industry's growth of 34.1% and the Zacks Consumer Discretionary sector's return of 12.8%.
Image Source: Zacks Investment Research
From a valuation standpoint, SSP stock is currently trading at a forward 12-months Price/Sales ratio of 0.13X compared with the industry's 4.12X. SSP has a Value Score of A.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for second-quarter 2025 loss is pegged at 4 cents per share, which has remained steady over the past 30 days, indicating 73.33% year-over-year growth.
E.W. Scripps Company (The) price-consensus-chart | E.W. Scripps Company (The) Quote
SSP currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Sinclair, Inc. (SBGI) : Free Stock Analysis Report
E.W. Scripps Company (The) (SSP) : Free Stock Analysis Report
Nexstar Media Group, Inc. (NXST) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research