Monday, August 07, 2023
Gray Television is a multimedia company headquartered in Atlanta, Georgia. We are the nation’s largest owner of top-rated local television stations and digital assets in the United States. Our television stations serve 113 television markets that collectively reach approximately 36 percent of US television households. This portfolio includes 80 markets with the top-rated television station and 100 markets with the first and/or second highest rated television station. We also own video program companies Raycom Sports, Tupelo Honey, PowerNation Studios and Third Rail Studios.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Jacob Mutchler, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Solid Q2 results. The company reported Q2 revenue of $813 million, a tad better than our estimate of $802 million; adj. EBITDA in the quarter was $225 million, beating our estimate of $187 million by 20%. Q2 results are Illustrated in Figure #1 Results. Notably, Local and National core advertising revenues performed strongly, increasing in the low single-digits from the prior year period. Additionally, Political revenue in the quarter was a strong $12 million, beating our estimate of $6 million by 100%.
Positive momentum. In our view, the company’s Local and National advertising growth was impressive, with many industry peers reporting declines. Notably, management highlighted that National and Local advertising are pacing up in Q3 as well. We believe the company has favorable operating momentum, given its resilient advertising revenues and expected influx of political revenue later this year and in 2024.
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