In more normal times, the cash flows would easily support their finding financial backers for that. And these ever lower interest rates may eventually support it anyway. With expectation for some kind of positive revenue growth for this industry, for each of the next 3 years, imo, this kind of stock price is absolutely insane. The worst thing the "summer slowdown" in the economy is going to have is shave a few pennies off the annual earnings estimate for ETM. That's IT. But we're still looking at $1.25 or so in EPS for this year, which, again, means we are selling for like 4.7x earnings, which, again, is just insane.
This is an important and COMPELLING opportunity, for thinking investors. Cash flow is king, and ETM has it in spades, at a truly astounding discount.
You don't know what you are talking about. The DVR has made ETM ineffective. Just skip, skip and you don't have to see any cereal, ED, toilet paper commercials. What do they pay for?
Monkey, company owns 110 RADIO stations in 23 markets... not a TV broadcast company. If TV advertising is less valuable given the impact of DVRs on digital ad insertion, as you indicate, then perhaps more dollars flow to radio. Stop wasting readers' time with your pointless and thoughtless posts.
LTF- Last time I was in this stock, I made good money. I will start buying on Monday and eventually will be my one of the top three holdings in my portfolio. I love this opportunity. I like and learn a lot from your analysis.
In one of the last couple of conference calls was a statement that (to the best of my recollection) it was a goal of the management to get the company back to pre-recession operating performance as soon as reasonably possible.
I interpret that as a resumption of the dividend no later than 2012. (According to 7.13(b) of the FIRST AMENDMENT TO CREDIT AGREEMENT ( http://sec.gov/Archives/edgar/data/1067837/000110465910026724/a10-5777_1ex10d01.htm ), the company is not allowed to be in a restricted period after 12/31/2011.) Since the annual dividend was $1.52 before the recession began, I'll take pre-recession operating performance to mean that there will be a dividend of $1.52 annually. That would be a 4% yield on a share costing $38. Suppose that a dividend at that rate begins being paid in Q3 2012, two years from now. Discounting $38 to present value at 40%, a reasonable annual rate of return, gives a current per-share value of $19.
I found even a $12 share price moderately insane (insanely low, that is). Only those WILLING to sell at $12 should sell at $12. NOBODY should be forced to sell at $12.
I will not repeat what I think of Emmis management.