ART & COMMERCE : Middle Squeeze

The stock market’s ascent has been fueled in part by spirited gains in corporate profits, reflecting the downsizing and economizing that companies have undergone since the early ’90s. In other words, profits go up when costs rise more slowly than sales. But in business, as in toothpaste, there’s only so much you can squeeze out of the middle.
Sooner or later, you have to sell more stuff to make more money. That is a primary thesis underlying the latest forecast for the advertising business from investment-banking boutique Veronis, Suhler & Associates, whose 11th annual Communications Industry Forecast has just been released.