Saga would do all investors a favor by selling the company instead of throwing money away on silly investments like Iceland or the Illinois and Michigan state networks. Do they have a board of directors....or cronies?
I couldn't help but respond to this....first off, being SEC correct, analysts project that both the Michigan and Illinois Radio Networks (with 70 plus affiliates each) will have been acquired at 5x 1999 cash flow. There are strong barriers to entry in state radio networks and run properly they are nice money machines. Today you can't buy broadcast cash flow at that kind of multiple...this is why they make sense. Now, regarding Iceland; when we finish with out build out in sixty to ninty days we will have 7 of the 10 commercial licenses in Reykjavik. We operate them all from one building downtown with two sales teams. Our entry cost was extremely low and there is marvelous upside potential by owning a large block of licenses.
Also, if you didn't notice within the last two weeks SAGA announced the acquisition of KAVU TV the ABC affiliate in Victoria Texas. Also included with KAVU is the low power Univision TV on channel 51. We also announced the acquisition of KGMI and KISM FM in Bellingham Washington. These are wonderful stations and we believe thata there are trememdous opportunities in the Pacific Northwest.
Since its inception as a public company Saga has shown an average increase of 30% per year on its stock price. Not bad for a conservative company who believes that it has a financial responsibility to its shareholders never to comprimise the financial integrity of the company through rapid or reckless acquisitons.
I'd be glad to answer any questions
Ed Christian President/CEO Saga Communications Edradiotv@aol.com Saga will be around for a long time and will continue to grow, just as it has since the day we started 12 years ago.
Thanks for joining in our discussion. I appreciate your insights. I have been pleased with my investment, however I was voicing frustration with the fact that since I bought my stock (7/19/96), SGA has underperformed most other radio broadcasting stocks. If one were to apply the 1998E BCF multiple of 13.5x paid for Triathlon Broadcasting to SGA, you'd get a value in excess of $22 for SGA. That's a premium of over 35% from today's stock price. The annualized rate of return on my investment has been 15.6% during the period I've held the stock. Respectable, no no barn burner in the bull market we've had for radio stocks in the past two years. That was my point.