Nielsen Holdings plc (NYSE:NLSN) recently announced the extension of its TV ratings service with Tennis Channel, beyond the Nielsen Local TV Ratings Service.
As part of the multi-year agreement, Nielsen will now provide its National TV Ratings service to Tennis Channel.
In addition, Nielsen is lending Tennis Channel access to other products and services. Tennis Channel can now conduct detailed analysis of TV audiences including custom demographics, time-shifted viewing and TV consumption habits. The company has access to Nielsen’s advertising intelligence that offers actionable insights on changes in ad spend across categories, markets and media.
Nielsen Set to Boost Revenues
We believe that the move will help Nielsen expand its client base and boost Watch segment revenues. The segment provides viewership and listening data and analytics across television, radio, online and mobile screens, primarily to media and advertising industries. The performance of the segment was particularly strong in the last quarter.
Last quarter, Watch business revenues totaled $769 million (50.4% of total first quarter revenue), up 10.8% year over year and 11.1% at constant currency. The rise came on the back of continued strength in Audience Measurement and Marketing Effectiveness, which improved 13.3% and 14%, respectively, on a constant currency basis.
Nielsen N.V. Revenue (TTM)
Excluding the acquisition of Gracenote, Watch revenues increased 5.9% or 6.2% at constant currency.
The strengthening of the Watch segment could boost shares that have lost 29.8% in the last one year. This is in contrast to the Zacks Business - Information Services industry’s gain of roughly 2%.
Tennis Channel to Draw Advertisers
Tennis Channel is now better equipped with Nielsen’s proven measurement solutions. Nielsen’s services will lend it a comprehensive view of audience across local as well as national TV, and daily measurement of commercial and program performance.
This in turn will enable Tennis Channel to attract potential advertisers by showcasing its growing fan base.
Key Takeaway
The deal is a prime example of how Nielsen is utilizing its strong position in viewership data and analytics across media and advertising industries and focusing on innovation to gain new clients and retain the existing ones.
Zacks Rank and Stocks to Consider
Currently, Nielsen is a Zacks Rank #3 (Hold) stock. Better-ranked stocks in the broader technology sector include Applied Materials (NASDAQ:AMAT) , MiX Telematics (NYSE:MIXT) and Alibaba (NYSE:BABA) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term expected earnings per share growth rates for Applied Materials, MiX Telematics and Alibaba are a respective 16.6%, 20% and 30.4%.
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