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Gray Television Inc. Message Board

  • value_invstr value_invstr Feb 8, 2013 10:11 AM Flag

    GTN is worth $10+

    GTN is a levered equity, but one that has everything going for it. They have refinanced everything, and now the only issue is what to do with all the free cash flow they generate. They will continue to grow with retrans, although this year will be a down year without the political. In this Q alone they should do close to $50m in FCF (4Q 2012) which will be used to pay down more debt. Story is geting better here, and I see nothing to stop it, plus they have some big retrans agreement coming up now. The technical guys can trade in/out of it and do whatever they want, but this stock should be at $10 or higher in 2 years. Something dramatic would have to change for it not to be, it's just math, and this is where this thing is projected to be by then. We've seen others in this sector just take off, this is the next to go.

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    • GTN is remotely connected to the GE / Comcast Deal. That deal will affect this stock. $10/15 range is a very good projection but not in two years but in one year. I'm all in on this one.

      Sentiment: Strong Buy

    • $10/$15 in 2 years is not unreasonable. But it's 2 years, a long time. I'm more interested in what GTN is worth now. Yesterday's action indicates GTN is not yet done adjusting higher, despite the fact this move has become extreme in both length and % gain. How much of this move is due to Q4 2012 and how much due to management's guidance for 2013? Technically GTN will most certainly retrace a % of this move. But from what price does it start? That is the question for traders. For investors, the question is what is management going to say about 2013?

      In 6 weeks, GTN has moved practically 100% from $2.25 where this move started, 75% from the breakout price of $2.50. I won't be surprised if it treads water here for 2 weeks, and takes the news in this range, say $4.30 to $4.90. What happens after that all depends on what management says on the earnings call.

      • 1 Reply to heezdedjim_2002
      • I think their is very little they could say or report that will make a meaningful difference. Several competitors have already reported, they have given us guidance on 4Q, investors should know what is going on by now. The business essentially has 2 components. The first is advertising, and that follows the general economy, nothing too shocking going on. The second is retrans, and we know that is a stable/growing contractual business and they have 2 contracts up in 1Q. As a long-term in investor, I'm not concerned if they do $60m or $63m in cash flow this year. It will be somewhere in that ballpark, and in 2014 it will be $130-$140. The only thing that is relevant is 1) do they continue to pay down debt? 2) When do they get equity friendly? 3) Are they a player in M&A?

    • GTN is worth 4.28 right now. ;)

 
GTN
10.70-0.06(-0.51%)12:23 PMEDT

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