Financial Newsletter High On Entercom
Despite stating the radio sector has fallen out of favor with investors, the Seeking Alpha financial newsletter, which has been on SiriusXM for a long time, has written a very positive piece about David Field's Entercom. The author of the newsletter says Entercom "exhibits strong qualities that have gone unappreciated by the market as interest in the radio space has shifted away from terrestrial and towards the 'trendier' Internet and satellite options. I believe that the sector offers lush hunting grounds for value -- as the companies are small, obscure, and trade at attractive valuations."
"I believe that Entercom's robust cash flow can be deployed into purchasing other radio companies or simply acquiring more station assets as the company has an established track record of this behavior -- with a recent acquisition in 2012. I believe that Entercom represents a compelling purchase for investors at current levels. The company, in my mind, is trading at much more rational valuations to its peers in the satellite or Internet radio sector -- currently offered at a modest premium to book value. The company also has high levels of insider ownership and robust free cash flow yield which could be diverted into either accretive acquisitions or into a dividend which stands to benefit shareholders enormously."
The newsletter states investors should not throw in the towel on radio and rely on what's become very popular, the Internet. "Local radio stations provide individuals with an attractive advertising proposition, as they have a captive audience and are able to direct their advertising dollars in a geographically relevant and focused manner, in contrast to other advertising venues such as Ihe internet."
Read the full piece on ENTERCOM HERE
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