Media research firm comScore Inc.

Media behavior research firm comScore Inc. posts modest profit

By Steven Porter

Consumer behavior measurement firm comScore Inc., which has set out to research cross-platform multiscreen media consumption, posted a profit Wednesday, modestly outperforming expectations.

Fourth-quarter net earnings were $4.4 million or 11 cents per diluted share, swinging upward from a loss of $2.7 million, or 8 cents per share,  in the same period a year earlier.

Revenue rose 8 percent to $97.7 million from $90.1 million.

Analysts surveyed by Yahoo! Finance had been expecting fourth-quarter earnings of 3 cents per share.

In a statement accompanying the earnings release, Serge Matta, comScore CEO, attributed the record-level revenue to continued “momentum in our audience and advertising solutions.” He further lauded the company’s new products and its merger with media analytics research firm Rentrak Corp.

Quarterly earnings, comScore Inc.
Fourth-quarter earnings for comScore Inc. were $4.4 million, or 11 cents per diluted share, swinging from a loss in the same quarter a year prior. (Steven Porter/MEDILL)

The merger could make comScore a more direct competitor of Nielsen Co., which dominates the media measurement market, Variety reported.

Nevertheless, comScore stock closed at $37.34, down 24 cents, in NASDAQ trading, continuing to tumble from its all-time high of about $65 last August.

Analysts nonetheless remained optimistic about the company’s future, with nine of the 10 surveyed by Bloomberg recommending that investors buy comScore shares.

Tracy Young, the sole dissenting analyst, rated the stock hold.

Young, a director at Evercore ISI who covers media information services, published a report Wednesday in which she identified risks comScore will have to address in the coming year. Most notably, the competition is evolving, she said.

“There has been a proliferation of small and medium sized firms offering niche measurement services with lower priced services (as evidenced by the number of companies offering online video measurement),” Young wrote, noting that major media companies have turned to in-house solutions to generate their own analytics.

Warning that the Rentrak merger “may take longer than expected,” Young set a target price of $44, the lowest among analysts surveyed by Bloomberg. Her counterparts at other firms set target prices as high as $75 per share.

Excluding costs associated with the Mobile Operator Analytics division, which the company disposed of last May, comScore reported adjusted earnings of 48 cents per diluted share, up from 46 cents in the fourth quarter of 2014.

For the year, the company posted a loss of $6.8 million or 18 cents per diluted share, narrowing the loss of $9.9 million, or 29 cents per share, in 2014.

Annual revenues, meanwhile, rose 12 percent to $368.8 million from $329.1 million.

Photo at top: Media consumption research firm comScore Inc., which recently merged with Rentrak Corp., posted a modest profit. (Courtesy image/comScore Inc.)