Salem Media Group: Continued Specialization In Christian And Conservative Content Serving Them Well

Salem Media Group: Continued Specialization In Christian And Conservative Content Serving Them Well

Salem Media Group is America’s leading Christian and conservative multi-media company. The Company operates through Radio Broadcast, Digital Media and Publishing segments. It owns and operates radio stations in many of the top 25 media markets, and produces several of the largest nationally syndicated radio shows on the air today.

November 8, 2021

Price (as of close on November 5, 2021)

$3.88

Rating

BUY

12- Month Target Price

Salem Media Group (SALM)

Revenue growth across Broadcast, Digital Media and Publishing segments. Land sales add $0.29 net of tax to Q3:21 EPS. We reiterate our Buy rating and increase our price target .     

Q3:21 Highlights

➢ Total revenues increase 8.8% YOY to $66.0 million reflecting growth across the Broadcast, Digital Media and Publishing segments.

➢Broadcast revenues improved 9.3% YOY to $49.6 million and station operating income rose 9.2% to $12.1 million.

➢Digital Media revenues rose 8.5% YOY to $10.6 million. However, segment operating income declined 10.8% to $2.4 million due to higher marketing costs and acquisition-related expenses. Publishing revenues increase 5.6% YOY to $5.7 million and operating income was $0.5 million.

➢Recurring operating expense increased 8.1% to $55.2 million. Revenue gains, higher operating profit and a $10.6 million gain on a land sale resulted in operating income of $15.8 million, versus $4.8 million last year and adjusted EBITDA of $10.8 million, up 12.5% YOY. Net income was $22.1 million or $0.81 per share, up from 0.3 million or $0.01 per share one year earlier. The land sale contributed $0.29 to Q3:21 EPS.

➢Salem ended Q3:21 with $23.8 million of cash and $208.6 million of long-term debt, down from $213.8 million in December. Increased EBITDA and reduced debt resulted in a decline in leverage to 5.5x from 8.6x one year ago.

➢Digital revenues are experiencing double-digit growth and helping to boost margins, which values SALM at 7x our FY:21 EBITDA estimate.

We at Singular Research hope you enjoyed this article and would like to invite you to try the full version of our service for free for 2-weeks on Seeking Alpha.

Please click here for your free trial!

Tags: Latest Updates