Business has been tough for newspapers for the better part of a decade now, with analysts at the American Enterprise Institute finding that print advertising revenues hit their lowest point since 1950 last year. Circulation has been falling as more and more consumers get their news online, in many cases from free sources, driving down the value of an ad in a print newspaper.

Newspapers aren’t the only print media being dragged down by falling sales; college textbook printers are running up against a growing number of students who buy used books, photocopy or scanned needed materials from other peoples books, download them illegally or simply don’t buy textbooks at all. According to data from the National Association of College Stores, student textbook spending has fallen from about $700 as recently as 2007 to less than $640 in 2013.

It’s almost as if it’s in print, no one cares. So what were once dependable, if even stodgy, income investments have become increasingly dangerous as the internet has supplant demand for print media of all kinds. But while some companies have languished, others are thriving as they adapt to the new media environment.

Pixelating Profits

Our international dividend advisory, Global Income Edge, has identified a digital winner in the languishing print world. The chief investment strategist of that service, Richard Stavros, has an insider’s view of Financial Times of London, a publication of Pearson PLC. He worked for the FT’s energy division in the late 1990s, developing analyses of and consulting on energy derivatives markets for bankers and traders.

While that energy division was eventually sold off for a tidy profit, it gave Richard the opportunity to see Pearson’s (NYSE: PSO) business prowess up close, and an appreciation for how the company put those profits to use developing educational services operations.

Like most other media companies, Pearson initially struggled with the transition to a digital world. But several years ago it launched digital textbooks and its “MyLab” technology, which combines online homework, tutorials and assessment products into a single web-based platform. That, combined with Pearson’s reputation for excellent, has allowed the company to secure long-term contracts to provide content to numerous schools in the U.S. and the U.K. That digital education business has become a cash cow for the company.

Of course, the FT still plays a role in Pearson’s business, contributing about 10% of the company’s revenue, though ad revenue there has been steadily falling over the past few years. The company also has a Professional segment, which provides testing services for a variety of professional societies around the world. For instance, certification tests conducted by the American Board of Internal Medicine and the Certified Financial Advisor Institute are handled by Pearson’s Professional segment.

The company has also made big bets in the emerging markets, which currently accounts for about 15% of revenue today but is expected to rise to 25% by the end of this year. In less developed parts of the world, access to quality educational content can be spotty, so online providers such as Pearson are an extremely attractive option. That leaves them well positioned to grab a chunk of what is estimated to be a global 60% increase in educational spending, a market expected to reach $8 trillion over the next five years.

To help it along towards that goal, Pearson hasn’t been shy about making acquisitions. In 2012 it acquired a major English-language-courses company which served 800,000 students and in 2010 purchased a Brazilian online education group which served about 530,000 students.

As the company has grown, it has been able to leverage economies of scale to improve operating margins. While annual revenue growth has averaged just 2.3% over the past decade, net income growth has averaged 25.6%. Earnings per share have grown in turn, with 10-year average growth of 25.4%.

That growth has allowed the company to be extremely generous with its shareholders, boosting its dividend in each of the past ten years for average annual payout growth of 7%. It is also been an aggressive buyer of its own shares, repurchasing about $1.2 billion worth of its stock each year since 2005.

Currently yielding 4.6%, given the steady nature of its business it also slightly less volatile than the S&P 500 with a beta of 0.96 over the past three years.

Just One of Many

Overall, Pearson is an excellent example of a steadily growing company which passes along much of its gains to its shareholders. It’s also just one of nearly two dozen dividend paying international stocks currently covered in Global Income Edge, with an average yield of better than 6% and generally lower volatility then the market at large.