Sector Spotlight: Media

In this week’s sector spotlight, I take a look at the media sector. Are opportunities lurking in the media sector for investors?

Article updated: 7 December 2020 8:00am Author: Michael Baxter

Media isn’t what it used to be. There was a time when we all knew what media was; it was easy to define. But digital has changed things. Now we see companies like Rightmove and, firms that some might describe as techs, classed as media. There are still traditional media companies, firms that publish magazines, newspapers or broadcast, companies like Pearson, Reed Elsevier and ITV, of course.

It is getting harder to make money from traditional media – digital has done that. It isn't easy to get readers to pay for online content, but advertising revenue has changed. Google and Facebook are so dominant in the advertising space that the rest are left to fight over scraps.

But while it is harder to make money from advertising online, and getting people to pay for content, events are different. So, a lot of publishers have attempted to gain leverage over their titles and loyal readership, via events. Whether these events are conferences or award ceremonies or something else, advertisers seem more willing to sponsor events than advertise in magazines, and people seem more willing to pay to attend events than pay for content – especially award ceremonies, complete with lavish dinners.

But then Covid came along and the events business has taken a hammering – webinars can work, but they don’t generate so much money. 

But instead, you hear the same four letters coming from media companies: data. “We are data companies, now,” they say.  So that’s the next big opportunity. I wonder, though. I am not sure readers of the publications are so keen on giving up data. What they want is good content. Sometimes, it seems to me that some media companies are putting collecting data ahead of producing outstanding content. They are letting the tail wag the dog, so to speak.

What we do see in the media sector is a huge array of small companies. But there are some big firms too.

I can’t cover them all here. Instead, I focus on companies that I think are especially interesting or the very largest in the sector.

By interesting, my main criteria here is revenue and profit growth over the last five years. 

I look at companies that have either seen revenue or profits at least double over the last five years, or have a market cap over £5billion. Unfortunately, this means both ITV and Moneysupermarket are excluded.

And that leaves us with nine companies.

Here is a brief look at each company, a few comments, their share price history, their profit and revenue story over the last five years, and balance sheet strength.


The word future is apt. The company began life as a publisher of computer games magazines and from there moved onto technology. Today, its stable of titles is rich indeed. From Country Life to FourFourTwo magazine, from Marie Claire to Modern Dad, and magazines such as Edge which focus on the future interactive entertainment. 

I am struck by its financial performance over the last half-decade. Revenue has increased more than five-fold since 2016, and it has gone from a £15million loss in 2016 to £52million profit this year.

Share price 1,778p
2020 high 2,075p
2020 low 600p
Five year high (2020) 2,075p
All time high (2000) 4,785p
Change last 12 months 30%
Change last five years 1,791%
Change since 1999 -27%
Market cap £m 1,743
Yield % 0.09
P/E 38
Revenue growth since 2015 476.3%
Pre-tax profits growth since 2015 loss making to profit making
Total assets/total liabilities 2.7%
Current assets/total liabilities 0.4%
Current assets/current liabilities 0.7%
net assets £m  382.0


The company says that it produces “live experiences based on high-quality speakers, stimulating content and platforms that enable discussion and networking.”

The events are supported by online content via its many digital magazines. It says that 700,000 delegates attend its events and brands for their markets include BIO-Europe, Biotech Showcase and TIDES in Biotech and Pharma; SuperReturn, FundForum and Inside ETFs in Finance; TMRE and Content Marketing World in Marketing and CMA Shipping in Maritime.

Revenue had more than doubled in the five years to the end of last year, and profits increased at quite a canter, too.

But I can’t think of a business model more likely to be adversely affected by Covid.  A lot depends on what happens to the event business, post-Covid. But the company does appear to have a strong balance sheet.

Share price 569p
2020 high 867p
2020 low 363p
Five year high (2019) 883p
All time high (2019) 883p
Change last 12 months -26%
Change last five years 3%
Change since 1998 125%
Market cap £m 8,550
Yield % 1.33
P/E 32
Revenue growth since 2015 138.4%
Pre-tax profits growth since 2015 45.0%
Total assets/total liabilities 2.2%
Current assets/total liabilities 0.1%
Current assets/current liabilities 0.5%
net assets £m  5,838.0


Pearson publishes education publications as well as a certain newspaper called the Financial Times, as well as Investors Chronicle. I believe that the FT is a superb newspaper, but it has not been an easy few years for Pearson. Yet in a way it has been a triumph – revenue has fallen over the last five years, but it has gone from a half a billion-pound loss in 2015 and a two billion-plus loss the following year, to profitability since 2017.

Share price 679p
2020 high 679p
2020 low 425p
Five year high (2019) 1,027p
All time high (2010) 1,970p
Change last 12 months 8%
Change last five years -13%
Change since 1995 53%
Market cap £m 5,115
Yield % 2.87
P/E 20
Revenue growth since 2015 -13.4%
Pre-tax profits growth since 2015 From loss making to profit
Total assets/total liabilities 2.3%
Current assets/total liabilities 0.8%
Current assets/current liabilities 1.9%
net assets £m 4232.0


This company was formally known as Reed Elsevier. 

Back in the day, Reed, and its subsidiary Business Press International, was the biggest publisher of B2B magazines in the world. It remains a titan in the publishing industry, with a £33 billion market cap.

It says: it is “a global provider of information-based analytics and decision tools for professional and business customers. We help scientists make new discoveries; doctors and nurses improve the lives of patients and lawyers win cases. We prevent online fraud and money laundering, and help insurance companies evaluate and predict risk. Our events enable customers to learn about markets, source products and complete transactions.”

In its latest trading update, it said: “The full-year outlook for our three largest business areas, STM, Risk and Legal, remains unchanged.”

However, exhibitions made up 16 per cent of revenue last year, and that clearly took a Covid-19 related hit.

Share price 1,752p
2020 high 2,099p
2020 low 1,482p
Five year high (2020) 2,099p
All time high (2020) 2,099p
Change last 12 months -4%
Change last five years 48%
Change since 1995 646%
Market cap £m 33,860
Yield % 2.61
P/E 23
Revenue growth since 2015 31.9%
Pre-tax profits growth since 2015 40.8%
Total assets/total liabilities 1.2%
Current assets/total liabilities 0.2%
Current assets/current liabilities 0.4%
net assets £m  2,190


With interest rates lower than ever, the appetite for house buying is still strong and Rightmove, with its massive online presence, appears to look pretty.

Both revenue and profits have grown at a respectable rate over the last five years. Can that growth continue? For as long as low-interest rates are maintained, it might.

Share price 632p
2020 high 695p
2020 low 400p
Five year high (2020) 695p
All time high (2020) 695p
Change last 12 months 2%
Change last five years 56%
Change since 2006 1,521%
Market cap £m 5,525
Yield % 0.44
P/E 32
Revenue growth since 2015 50.5%
Pre-tax profits growth since 2015 56.2%
Total assets/total liabilities 1.8%
Current assets/total liabilities 1.1%
Current assets/current liabilities 1.4%
net assets £m  42.0

Time Out Group

I have included this company in this article because of the impressive revenue growth seen over five years. Losses have stayed at a similar level, though.

Share price 41p
2020 high 122p
2020 low 28p
Five year high (2017) 141p
All time high (2017) 141%
Change last 12 months -66%
Change since 2016 -71%
Market cap £m 116
Yield % N/A
P/E -3
Revenue growth since 2015 165.5%
Pre-tax profits growth since 2015 Loss making, flat over period
Total assets/total liabilities 1.8%
Current assets/total liabilities 0.3%
Current assets/current liabilities 1.1%
net assets £m  78.0


I am sure there is a reason for this, but my heart always sinks when, after reading a company’s about us section, I am none the wiser. It says: “We transform knowledge into advantage, keeping our clients at the centre of everything we do. In today’s knowledge economy, where differentiation using traditional criteria is often impossible, we help our clients to understand their challenges better and to use information to improve their businesses.”

Thanks for that? That description could apply to a myriad of companies.

It says: “Risk & Compliance, Professional and Healthcare. Our information, education and networking opportunities enable clients to transform their business. We invest in exceptional talent, and our people share a commitment to success that is second to none. Harnessing this energy, we deliver consistent growth to all stakeholders.”

I hope its titles, publications such as Compliance Week and HSJ do a better job of explaining what they do, than the company manages.

However, it has gone from a £3.4 million loss to a £15 million profit last year — although it took a Covid related knock in 2020.

Share price 151p
2020 high 300p
2020 low 109p
Five year high (2017) 281p
All time high (1996) 439p
Change last 12 months -35%
Change last five years -42%
Change since 1995 144%
Market cap £m 132
Yield % 6
P/E 28
Revenue growth since 2015 6.6%
Pre-tax profits growth since 2015 From loss making to profit
Total assets/total liabilities 1.3%
Current assets/total liabilities 0.4%
Current assets/current liabilities 0.8%
net assets £m  43.0


WPP may be one of the world’s largest communication and services companies, but I worry about it. Martin Sorrell founded it, but he has moved on, he now heads up S4 Capital. His new venture is about digital marketing; WPP has not wowed clients with the way it has embraced digital. Maybe that is the reason that profits have fallen over five years.

Share price 780p
2020 high 1,069p
2020 low 484p
Five year high (2017) 1,872p
All time high (2017) 1,872p
Change last 12 months -19%
Change last five years -48%
Change since 1995 650%
Market cap £m 9,555
Yield % 2.9
P/E 16
Revenue growth since 2015 8.9%
Pre-tax profits growth since 2015 -34.2%
Total assets/total liabilities 1.4%
Current assets/total liabilities 0.7%
Current assets/current liabilities 1.0%
net assets £m  8,443.0


Profits have seen impressive growth at the UK’s most famous compiler of surveys. But then YouGov is the archetypal data company – and if data is the new oil, maybe YouGov is the latter-day equivalent of an oil company – or at least a mining company, a data mining company, that is.

Share price 890p
2020 high 1,040p
2020 low 400p
Five year high (2020) 1,040p
All time high (2020) 1,040p
Change last 12 months 59%
Change last five years 486%
Change since 1995 2,969%
Market cap £m 990
Yield % 0.56
P/E 99
Revenue growth since 2015 72.7%
Pre-tax profits growth since 2015 172.7%
Total assets/total liabilities 2.6%
Current assets/total liabilities 1.0%
Current assets/current liabilities 1.3%
net assets £m  109.0

All prices are approximate figures taken from 4 December 2020.

These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees.

Michael Baxter portrait photo
Michael Baxter

Economics Commentator

Michael is an economics, investment and technology writer, known for his entertaining style. He has previously been a full-time investor, founder of a technology company which was floated on the NASDAQ, and a director of a PR company specialising in IT.

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