QUOTE AND NEWS
Forbes  May 22  Comment 
Since taking her post as Secretary of the Department of Health and Human Services (HHS) in 2009, Power Woman  Kathleen Sebelius has arguably one of the most difficult jobs in the nation. For starters, she’s not just at the center of one of the...
StreetInsider.com  May 21  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Amazon+Web+Services+Meets+FedRAMP+Requirements+From+U.S.+HHS/8357394.html for the full story.
CNNMoney.com  May 8  Comment 
Read full story for latest details.
StreetInsider.com  May 7  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Dividends/Harte-Hanks%2C+Inc.+%28HHS%29+Declares+%240.085+Quarterly+Dividend%3B+4.2%25+Yield/8311884.html for the full story.
Cloud Computing  May 7  Comment 
Aberdeen Group, a Harte-Hanks Company (NYSE: HHS), today announced the publication of new research reports from its Business Analytics and Business Intelligence research practice. read more
CNNMoney.com  May 1  Comment 
Read full story for latest details.
StreetInsider.com  Apr 26  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Upgrades/Noble+Financial+Upgrades+Harte-Hanks+Inc.+%28HHS%29+to+Buy/8281826.html for the full story.
StreetInsider.com  Apr 25  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Earnings/Harte-Hanks%2C+Inc.+%28HHS%29+Reports+In-Line+Q1+EPS/8278484.html for the full story.
MedPage Today  Apr 24  Comment 
WASHINGTON (MedPage Today) -- The Obama administration has released updated cultural policies and principles to help providers better relate to minorities, address their care needs, and ultimately reduce racial disparities.
MedPage Today  Apr 10  Comment 
WASHINGTON (MedPage Today) -- The Obama administration released its fiscal year 2014 budget proposal Wednesday, trimming nearly $400 billion over 10 years from Medicare as expected.




 

Harte-Hanks (NYSE: HHS) provides direct marketing services and advertising opportunities to consumer and business-to-business marketers. Its revenues are derived from two operating segments: direct marketing (which operates worldwide and accounts for 68% of revenues) and shoppers (which mainly operates in local markets in California and Florida and accounts for 32% of revenues).[1] As a result, Harte-Hanks is largely dependent on economic conditions in California and Florida as most of its operations are based in those regions. In addition, increases in postage costs and removing Saturday deliveries would pressure HHS's profit margins and revenue, respectively.

Business Growth

In 2010, net sales stayed flat at $860 million. Net income increased 12.3% to $53.6 million, however, due to plant consolidations and decreased paper costs. [2]

Trends and Forces

Fluctuations in the economy in California and Florida affects HHS bottom line

HHS' shoppers business segment accounts for 32% of its revenues and this segment is mostly concentrated in California and Florida. This business consists of weekly advertising publications that are distributed for free to consumers' homes through mail, websites, newspapers, etc. Therefore, revenue is based on local advertising expenditures in these areas. Economies in California and Florida still continue to suffer from effects of the 2007 Credit Crunch, especially in terms of weaknesses in the real estate markets. Therefore, consumer spending has remained low despite growth throughout the country. In addition, natural or manmade disasters in these areas could negatively affect businesses and consumer expenditures. California is especially known for its earthquakes, such as the 7.2 magnitude earthquake in April 2010.[3] In turn, such events negatively impact HHS' ability to earn revenue from this operating segment.[4] Such losses were reflected in 2010's first quarter performance where a 9.8% decline in revenue was mainly attributed to California and Florida's poor economies and HHS' shoppers business.[5]

Possible Postage Changes Pressure HHS's Business Model.

The U.S. Postal Service has been pressuring regulators for two new items: increasing postage costs[6] and removing Saturday delivery.[7] Increasing postage costs would increase operating costs for HHS's Shoppers segment, as it provides print advertising to consumers. Removing Saturday delivery may cause the Shoppers segment to lose clients, as Saturday is a popular shopping day, so consumers receiving advertising in the mail on Saturday mornings is important for weekend shopping.

Competitors

  • Valassis Communications (VCI): Valassis competes with Harte-Hanks in terms of its marketing services and its RedPlum direct mailing business.[8]
  • Acxiom (ACXM): Acxiom's information products operating segment offers a marketing database that can be used to assemble mailing lists for advertising. As a result, this competes directly with Harte-Hanks' shopper segment. For 2010, Acxiom's information products segment was 23% of its revenue and decreased 30% from 2009 to $249.8 million.[9]

References

  1. http://www.harte-hanks.com/static/base/ShareholdersAnnual_2009.pdf
  2. http://www.harte-hanks.com/Page/NewsArticle/HHArticle4_2011/
  3. http://www.riskmanagementmonitor.com/easter-quake-damage-will-not-exceed-1b/
  4. http://www.harte-hanks.com/static/base/ShareholdersAnnual_2009.pdf
  5. http://www.harte-hanks.com/Page/NewsArticle/HHArticle14_2011/
  6. Bloomberg, "U.S. Postal Service Proposes 2-Cent Rise for First-Class Mail," 7/7/2010
  7. Bloomberg, "U.S. Lawmakers Push to Block Postal Service Plan to Cut Saturday Delivery," 07/30/2010
  8. http://www.hoovers.com/company/Valassis_Communications_Inc/rtyfhi-1.html
  9. http://www.acxiom.com/SiteCollectionDocuments/website-resources/Supporting_Financials/Supporting_Financials/FY10/Acxiom_2010_Annual_Report-FINAL.pdf
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki