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Tuesday, April 16, 2019
Cumulus Media (CMLS)
Four Key Takeaways From The Recent Announcement.
Cumulus Media, Inc., a radio broadcasting company, engages in the acquisition, operation, and development of commercial radio stations in mid-size radio markets in the United States. It owns and operates FM and AM radio station clusters that serve mid-sized markets. The company, through its investment in Cumulus Media Partners, LLC, also operates radio station clusters serving large-sized markets.
Michael Kupinski, DOR, Senior Research Analyst, Noble Capital Markets, Inc.
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- Another deleveraging transaction. The company announced plans to sell KLOS radio station for a favorable $43 million, an estimated multiple of an attractive 8 times cash flow. We believe that the net proceeds from the transaction will be roughly $39 million, with the proceeds to be used to pay down debt. The transaction is expected to close in the third quarter 2019.
- The company also announced plans to swap two of its Connecticut radio stations for four stations in Allentown, Pennsylvania, strengthening its portfolio of two existing stations in that market and complimenting its strong station group in Pennsylvania. The move should enhance cash flow margins.
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*Analyst certification and important disclosures included in 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.