Good Ad Growth Expected At Mirror

“Healthy” advertising growth of 5.3% is expected at the Mirror Group in 1998, according to a report published by Merrill Lynch.

The firm has also put an Accumulate rating on the media group’s shares, due to its current low value and projected solid earnings growth of 7.5% per annum to the year 2000. However, Merrill Lynch says that long term new management still needs to prove it can boost growth rates through expansion in regional press and elsewhere.

The report criticises the Sunday Mirror and People titles for “lacking differentiation”. It says that the titles are two of the weaker Sunday brands and seem to suffer from the “lack of a distinct image.” This causes problems not only because of the tough competition provided by the News of the World but also because the titles “frequently compete against each other.”

In terms of the troubled Independent titles, Merrill Lynch sees little change in their ownership in the short-term. This is because the other major shareholder (Independent Newspapers) is an unlikely seller and an unlikely buyer of the Mirror Group’s stake. Third parties, meanwhile, are “generally interested in full control” only.

Merrill Lynch: 0171 772 1000