“Gazeta Wyborcza” copy sales crossed 500,000 copies mark in the past week, rising from an average level of 440,000 copies earlier in the year, according to Agora's own preliminary data. The increase comes amidst increased rivalry in the Polish newspaper market after ASP launch of “Dziennik” daily. The jump in circulation reflects almost a halving of Gazeta's price per copy, as readers now could get 2 quality newspapers for the price of PLN 3.0. Importantly, the strong circulation bodes well for Gazeta's advertising revenues.
We think that the news could trigger a rebound on the stock, which has been under pressure in the past few days. We reiterate our Buy rating for Agora with PLN 60.0 fair value estimate.