Time Inc shares drop on NYSE debut

<p>Stocks in the new media company fell by four per cent yesterday.</p>

The share price of newly formed media organisation Time Inc fell yesterday (June 9th) on the back of the firm's arrival on the New York Stock Exchange.

After stocks in the company were made available on the index for the first time, their value fell by around six per cent, before recovering later in the session. By the end of the day, stocks in Time Inc were just 0.8 per cent down on the start of trading, ending the firm's first session on the New York Stock Exchange 18 cents lower at $23.30 (£13.86).

Time Inc has been formed by parent company Time Warner spinning off the publishing arm of the business, with titles such as Time, People, Sports Illustrated and Fortune produced by the firm. In total, Time Inc is responsible for dozens of websites and almost 100 magazines.

Chief executive of the company Joe Ripp has vowed to pursue acquisitions in the coming months and told Reuters in an interview that he believes the future is bright for Time Inc.

He said: "I think you're going to be seeing lots of acquisitions from us. Some smaller and some a little bit bigger, but I'm not looking at anything for $1 billion right now. There's nothing like that in my sights."

Debt levels

Time Inc has a large amount of debt that it took on when splitting off from the parent company, with the firm responsible for approximately $1.3 billion in total. In a bid to save money for the business, Time Inc is set to leave its famous offices in the Time-Life building in midtown Manhattan for a less expensive location in New York in the coming months.

Ken Doctor, a research analyst at Outsell Inc, explained Time Inc is facing competition from new media businesses and this may make it difficult for it to have a major impact on the New York Stock Exchange.

He said: "You can manage declines but at some point you've got to have a way to turn around that story."

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.