As Legacy Media Declines, Radio Stands Out – And New Players Emerge

The media landscape is rapidly shifting, with many legacy formats like pay TV seeing accelerating declines. But amid this turmoil, radio has showed surprising resilience according to a recent report. Terrestrial radio revenue and listenership has held relatively steady over the past decade even as cable TV crumbled.

This contrast highlights radio’s enduring role delivering localized, personality-driven and interactive content. While digital disruption has hindered other mediums, broadcasters see internet streaming and podcasts as opportunities to expand radio, not threats. Already, leading players are blending new digital formats with traditional over-the-air offerings.

The stubborn stability of radio presents a growth opportunity for investors amid the broader challenges facing legacy media. Traditional TV and print advertising revenue continues falling sharply, down 18% and 14% respectively in 2023 per GroupM estimates. But radio ad spending is only projected to slip 6% this year.

Plus, radio has room to run just to regain pre-pandemic ad levels. Industry leader iHeartMedia saw a 23% decline in broadcast revenue from 2019 to 2023. As the ad market rebounds post-Covid, radio looks relatively attractive compared to more distressed legacy formats.

This backdrop has powered a radio resurgence among new industry entrants spotting untapped potential. Direct Digital Holdings, which went public in 2022, and focuses on bringing digital marketing services to the marketplace.

Direct Digital believes this digital model can drive growth even as terrestrial broadcasting plateaus. The company aims to capture ad budgets shifting online through its provision of website, social media and other digital services to small businesses alongside traditional radio spots.

Another radio-centric new media play, Cumulus Media, is the country’s third largest radio broadcaster, reaching over 250 million monthly listeners nationwide. The company aims to grow by broadening its podcast portfolio and expanding digital marketing.

Cumulus sees its vast broadcast reach as a foundation to build a larger digital advertising presence. Its extensive owned-and-operated radio station network provides proprietary access to a loyal listener base that rivals tech platforms. The company is positioning itself as the radio industry’s digital transformation leader.

Radio’s resilience indicates it retains inherent competitive advantages that persist through technological changes. Broadcasters recognize and leverage their unique strengths even as they adapt business models. The localism and personality that define radio continue driving engagement.

Plus, radio’s cost structure is finely tuned after a century on the air. Mature players keep tight control of expenses and operate profitably on thinner margins than many digital media outlets. This helps incumbents squeeze more value from legacy radio as they make measured moves into emerging formats.

Investors must still approach new radio-centered media endeavors with eyes wide open. Industry ad revenues remain under pressure. Music streaming and podcasts pose competition for listeners’ time. Consolidation carries integration risks and may face regulatory hurdles.

But traditional radio has survived the disruptive forces that felled newspapers and gutted cable TV. This time-tested durability, combined with digital growth prospects, makes radio-oriented media a relatively bright spot for investors in a tumultuous industry.

Backed by resilient legacy radio assets and focused digital strategies, companies like Direct Digital and Cumulus Media, and many others, offer upside potential. Though uncertainty remains, their radio footholds provide a stable base absent in other legacy media formats ravaged by technological change.

For investors seeking growth media plays beyond tech giants, radio’s lingering relevance points to pockets of opportunity. New digital/broadcast hybrid models show promise for revitalizing radio’s mature but enduring advertising business. With the right vision and execution, radio-centric firms could unlock more value and continue this legacy medium’s surprising success story.

Take a look at more emerging media companies by taking a look at Noble Capital Markets’ Director of Research Michael Kupinski’s coverage universe.

A Reason for Investors to Look at the New Dynamics of Broadcast Media

Image Credit: Cottonbro Studio (Pexels)

Selling Air Time is Getting Easier for Broadcast Radio

Is broadcast radio losing its power? It doesn’t appear to be, and the medium may be of interest to investors that prefer to shy away from short-lived investment trends and instead look to more easily understood opportunities. According to the industry publication Ad Age, the industry is nearing an intersection where “18- to 49-year-olds are spending more time listening to radio than watching linear TV.” At least one large company has reworked its advertising budget to save money with the expectation of reaching more people. Is this a trend hat will grow?

Re-investing in Radio

Soap opera’s got their start nearly 100 years ago as Proctor and Gamble, manufacturer of soap and candles, created the addictive entertainment to position its product ads in front of the typical soap decision maker of the time. As TV became a fixture in households in the 1950s, P&G adapted and brought the shows and the advertising to television. Last year P&G increased its spending on traditional broadcast radio by 43%. Despite all the new advertising options available, and the ability to refine targeting, P&G has a method to their madness, and it’s worth understanding.

Why the Reversal?

Last year, in the face of rising costs, the marketing giant came under margin pressure. In an attempt to minimize price hikes and maintain old margins, they cut ad spending by 10%, with a new budget of $2.2 billion.

The CEO Jon Moeller had told P&G brand marketers to focus on how many people they reach and how often, rather than how targeted or how much they spend. Chief Brand Officer Marc Pritchard became focused on the effectiveness of radio, connected TV, and streaming free ad-supported TV (FAST).

Belt Tightening

Just as inflation has caused many households to be more frugal, perhaps use less expensive brands, and eat more at home, companies like P&G are finding they are taking a similar approach. And if it helps keep prices down, they can more easily retain customers and attract new ones.  

Here is some data on the extreme cost of reaching a broadcast TV audience. In the business, CPM (cost per mile) is a paid ad method where there is a certain rate for every 1000 impressions an ad receives. The CPM to reach TV audiences is as high as $35 to $65. For comparison, YouTube video CPMs range from $20 to $25, and linear TV is in the $10 to $15 range.

But radio can be bought in the $5-$6 CPM range. The targeting may not be as precise as broadcast TV or other media, but the amount spent for every 1000 impressions is a fraction of the alternatives.

Places Investors Might Explore

Other large advertisers are stepping up their radio efforts as well. Pharmaceutical companies Pfizer, and Johnson & Johnson have started to spend more. According ad intelligence provider Vivvix. Pfizer became a top-five radio advertiser last year. They did this by more than doubling spending.

If you haven’t been following media companies, there is some acclimating to terminology, seasons, and how they profit. Two key places for information is the media report that Noble Capital Markets published late January of this year. The report which is available at this link was prepared by top analysts and discusses the recent state of radio, TV, digital media, and publishing.

A video produced just weeks before the published report by members of the same team can be helpful in providing you with insight as to one media company’s strengths over another. The video, featuring Michael Kupinski, Director of Research at Noble Capital Markets, is a half-hour full of insights. At this link.

Do you wish to hear directly from management of broadcast media companies impacted by new trends?

There are two companies that will be conducting three roadshows in Florida over the next two weeks. If you can attend, you’ll have the opportunity to hear directly from management what the future expectations are, and you’ll have the opportunity to ask questions of your own. The company names, locations and dates are available at this link, along with other scheduled roadshows.

Take Away

The most talked about stocks on the chat boards aren’t the only actionable opportunities astute investors can select from. As with all investing, growing your knowledge base can help one expand their watch-list.

P&G’s ad spend adjustment comes at a time when standard AM/FM radio has caught to and is neck and neck with linear TV (for people 18-49 in the U.S.). Radio audiences may not be growing, but they are not declining as broadcast TV audiences have – they are fairly consistent, and ad costs are a great value at a time when companies are dealing with their own increasing costs. This is getting the attention of large advertisers, and it perhaps should get the attention of investors.

Paul Hoffman

Managing Editor, Channelchek

Release – Entravision Announces Participation In The Singular Research Best Of The Uncovered Conference

Research, News, and Market Data on EVC

12/05/2022

SANTA MONICA, Calif.–(BUSINESS WIRE)– Entravision (NYSE: EVC), a leading global advertising solutions, media and technology company, today announced Chris Young, Chief Financial Officer and Treasurer, will present at the Singular Research Best of the Uncovered Conference to be held virtually Thursday, December 8, 2022. Management is scheduled to present at 12:15 pm PT.

The presentation will be webcast live over the Internet, and links to the live webcast and replay will be available on Entravision’s Investor Relations website at investor.entravision.com.

About Entravision Communications Corporation

Entravision is a leading global advertising, media and ad-tech solutions company connecting brands to consumers by representing top platforms and publishers. Our dynamic portfolio includes digital, television and audio offerings. Digital, our largest revenue segment, is comprised of four business units: our digital sales representation business; Smadex, our programmatic ad purchasing platform; our branding and mobile performance solutions business; and our digital audio business. Through our digital sales representation business, we connect global media companies such as Meta, Twitter, TikTok and Spotify with advertisers in primarily emerging growth markets worldwide. Smadex is our mobile-first demand side platform, enabling advertisers to execute performance campaigns using machine learning. We also offer a branding and mobile performance solutions business, which provides managed services to advertisers looking to connect with global consumers, primarily on mobile devices, and our digital audio business provides digital audio advertising solutions for advertisers in the Americas. In addition to digital, Entravision has 49 television stations and is the largest affiliate group of the Univision and UniMás television networks. Entravision also manages 45 primarily Spanish-language radio stations that feature nationally recognized, Emmy award-winning talent. Shares of Entravision Class A Common Stock trade on the NYSE under ticker: EVC. Learn more about our offerings at entravision.com or connect with us on LinkedIn and Facebook.

For more information, please contact:

Christopher T. Young
Chief Financial Officer
Entravision
310-447-3870

Kimberly Esterkin
Addo Investor Relations
310-829-5400
evc@addo.com

Source: Entravision Communications Corporation

Release – Entravision Announces Participation In The 2022 Southwest Ideas Investor Conference

Research, News, and Market Data on EVC

11/10/2022

SANTA MONICA, Calif.–(BUSINESS WIRE)– Entravision (NYSE: EVC), a leading global advertising solutions, media and technology company, today announced Chris Young, Chief Financial Officer and Treasurer, will present at the 2022 Southwest IDEAS Investor Conference to be held November 16-17, 2022 in Dallas, Texas. Management is scheduled to present on Wednesday, November 16th at 11:00 am CT.

The presentation will be webcast live over the Internet, and links to the live webcast and replay will be available on Entravision’s Investor Relations website at investor.entravision.com.

About Entravision Communications Corporation

Entravision is a leading global advertising, media and ad-tech solutions company connecting brands to consumers by representing top platforms and publishers. Our dynamic portfolio includes digital, television and audio offerings. Digital, our largest revenue segment, is comprised of four business units: our digital sales representation business; Smadex, our programmatic ad purchasing platform; our branding and mobile performance solutions business; and our digital audio business. Through our digital sales representation business, we connect global media companies such as Meta, Twitter, TikTok and Spotify with advertisers in primarily emerging growth markets worldwide. Smadex is our mobile-first demand side platform, enabling advertisers to execute performance campaigns using machine learning. We also offer a branding and mobile performance solutions business, which provides managed services to advertisers looking to connect with global consumers, primarily on mobile devices, and our digital audio business provides digital audio advertising solutions for advertisers in the Americas. In addition to digital, Entravision has 49 television stations and is the largest affiliate group of the Univision and UniMás television networks. Entravision also manages 45 primarily Spanish-language radio stations that feature nationally recognized, Emmy award-winning talent. Shares of Entravision Class A Common Stock trade on the NYSE under ticker: EVC. Learn more about our offerings at entravision.com or connect with us on LinkedIn and Facebook.

For more information, please contact:

Christopher T. Young
Chief Financial Officer
Entravision
310-447-3870

Kimberly Esterkin
Addo Investor Relations
310-829-5400
evc@addo.com

Source: Entravision Communications Corporation

Salem Media Group (SALM) – A Tough Quarter Ahead


Friday, November 04, 2022

Salem Media Group is America’s leading multimedia company specializing in Christian and conservative content, with media properties comprising radio, digital media and book and newsletter publishing. Each day Salem serves a loyal and dedicated audience of listeners and readers numbering in the millions nationally. With its unique programming focus, Salem provides compelling content, fresh commentary and relevant information from some of the most respected figures across the Christian and conservative media landscape.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Patrick McCann, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Q3 meets expectations. The company reported Q3 revenue of $66.9 million, in line with our estimate of $66.6 million. Adj. EBITDA of $6.1 million was slightly better than our forecast of $5.5 million, illustrated in Figure #1 Q3 Variance. Notably, we are adjusting EBITDA for a one-time legal settlement fee paid by the company during the quarter.


Weak Q4 pacing. Management guided Q4 revenue down 3-5% year-over-year compared with our expectation of 7% growth. Management cited a weak Publishing outlook as well as an ongoing pullback in the company’s #1 broadcast advertising category (mortgage companies) as primary factors in the challenged outlook.


Get the Full Report

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Entravision Communications (EVC) – A Breakout Year For Political


Friday, November 04, 2022

Entravision Communications Corporation is a diversified Spanish-language media company utilizing a combination of television and radio operations to reach Hispanic consumers across the United States, as well as the border markets of Mexico. Entravision owns and/or operates 53 primary television stations and is the largest affiliate group of both the top-ranked Univision television network and Univision’s TeleFutura network, with television stations in 20 of the nation’s top 50 Hispanic markets. The Company also operates one of the nation’s largest groups of primarily Spanish-language radio stations, consisting of 48 owned and operated radio stations.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Patrick McCann, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Solid Q3 results. Q3 revenue of $241 million increased 21% versus the prior year period, better than our $234.1 million estimate. Digital revenues accounted for much of the upside variance while stronger than expected Political advertising contributed as well. Adj. EBITDA was $25.9 million, up 12% year over year, slightly below our $27.3 million estimate, which was impacted by currency exchange rates. 

Digital continues its impressive growth. Digital revenues increased 29%, driven by strong performance of the company’s digital ad agency business in Latin America. Additionally, the recent acquisitions of 365 Digital and MediaDonuts were not fully accounted for in in Q3 of 2021, leading to further upside in the quarter.


Get the Full Report

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Cumulus Media (CMLS) – Economic Headwinds Prevail


Monday, October 31, 2022

Cumulus Media (NASDAQ: CMLS) is an audio-first media company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. Cumulus Media engages listeners with high-quality local programming through 406 owned-and-operated radio stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across more than 9,500 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through the Cumulus Podcast Network, its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. Cumulus Media provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. Cumulus Media is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Favorable Q3 results. The company reported Q3 revenue of $233.5 million, just above our expectation of $230 million.  Despite revenue decreasing 2% from the previous quarter Adj. EBITDA grew by 1.6% to $46.6 million beating our forecast of $41.7 million by 11.7%. 

Lowers guidance. Q4 revenue is expected to decline low to mid single digits in spite of influx of Political advertising, which too appears softer than expected. Local advertising appears to have softened, which implies that local businesses are now feeling the affect of the economic headwinds. Management lowered Adj. EBITDA guidance from a range of $175 million to $200 million to a range of $160 million to $170 million. 


Get the Full Report

This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Release – Salem Media Group Schedules Third Quarter 2022 Earnings Release and Teleconference

Research, News, and Market Data on SALM

October 27, 2022 12:00pm EDT

IRVING, Texas–(BUSINESS WIRE)– Salem Media Group, Inc. (NASDAQ: SALM) announced today that it plans to report its third quarter 2022 financial results after the market closes on November 3, 2022.

The company also plans to host a teleconference to discuss its results on November 3, 2022 at 4:00 p.m. Central Time. To access the teleconference, please dial (888) 770-7291, and then ask to be joined to the Salem Media Group Third Quarter 2022 call or listen to the webcast.

A replay of the teleconference will be available through November 17, 2022 and can be heard by dialing (800) 770-2030 – replay PIN number 2413416, or on the investor relations portion of the company’s website, located at investor.salemmedia.com.

ABOUT SALEM MEDIA GROUP:

Salem Media Group is America’s leading multimedia company specializing in Christian and conservative content, with media properties comprising radio, digital media and book and newsletter publishing. Each day Salem serves a loyal and dedicated audience of listeners and readers numbering in the millions nationally. With its unique programming focus, Salem provides compelling content, fresh commentary and relevant information from some of the most respected figures across the Christian and conservative media landscape. Learn more about Salem Media Group, Inc. at www.salemmedia.comFacebook and Twitter.

View source version on businesswire.com: https://www.businesswire.com/news/home/20221024005898/en/

Evan D. Masyr
Executive Vice President and Chief Financial Officer
(805) 384-4512
evan@salemmedia.com

Source: Salem Media Group

Released October 27, 2022

Release – Salem Media Group to Present at the LD Micro Main Event XV Investor Conference

Research, News, and Market Data on SALM

October 20, 2022 12:00pm EDT

IRVING, Texas–(BUSINESS WIRE)– Salem Media Group, Inc. (NASDAQ: SALM), announced today that it will present at the Annual LD Micro Main Event XV investor conference at 4:00 P.M. Central Time on October 26, 2022. The presentation will be available on the investor relations portion of the company’s website www.salemmedia.com prior to the company’s presentation.

ABOUT LD MICRO/SEQUIRE:

LD Micro began in 2006 with the sole purpose of being an independent resource to the microcap world. What started as a newsletter highlighting unique companies, has transformed into the pre-eminent event platform in the space. For more information, please visit ldmicro.com.

In September 2020, LD Micro was acquired by SRAX, a financial technology company that unlocks data and insights for publicly traded companies. Through its premier investor intelligence and communications platform, Sequire, companies can track their investors’ behaviors and trends and use those insights to engage current and potential investors across marketing channels. For more information on SRAX, visit srax.com and mysequire.com.

ABOUT SALEM MEDIA GROUP:

Salem Media Group is America’s leading multimedia company specializing in Christian and conservative content, with media properties comprising radio, digital media and book and newsletter publishing. Each day Salem serves a loyal and dedicated audience of listeners and readers numbering in the millions nationally. With its unique programming focus, Salem provides compelling content, fresh commentary and relevant information from some of the most respected figures across the Christian and conservative media landscape. Learn more about Salem Media Group, Inc. at www.salemmedia.comFacebook and Twitter.

View source version on businesswire.com: https://www.businesswire.com/news/home/20221013006073/en/

Evan D. Masyr
Executive Vice President and Chief Financial Officer
(805) 384-4512
evan@salemmedia.com

Source: Salem Media Group, Inc.

Released October 20, 2022

Salem Media Group (SALM) – Fast Forward To The Fourth


Thursday, September 08, 2022

Salem Media Group is America’s leading multimedia company specializing in Christian and conservative content, with media properties comprising radio, digital media and book and newsletter publishing. Each day Salem serves a loyal and dedicated audience of listeners and readers numbering in the millions nationally. With its unique programming focus, Salem provides compelling content, fresh commentary and relevant information from some of the most respected figures across the Christian and conservative media landscape.

Michael Kupinski, Director of Research, Noble Capital Markets, Inc.

Patrick McCann, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Updates Q3 guidance. Management lowered Q3 revenue guidance from a range of 6% to 8% growth to a range of flat to a positive 2%. The company indicated that the lower revenue outlook was due to a shift in revenue related to the Dinesh D’Souza book slipping into Q4 and softer expectations in its SalemNow segment. 

SalemNow likely disappointing. We believe that the softer revenue expectations in SalemNow is likely related to a poor performance for Uncle Tom II. We like the company’s expansion into content, which can be very lucrative, but the success of the content is hard to predict.


Get the Full Report

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.