Friday, November 03, 2023
Saga Communications, Inc. is a broadcast company whose business is primarily devoted to acquiring, developing and operating radio stations. Saga currently owns or operates broadcast properties in 27 markets, including 79 FM and 33 AM radio stations. Saga’s strategy is to operate top billing radio stations in mid sized markets, defined as markets ranked (by market revenues) from 20 to 200. Saga’s radio stations employ a myriad of programming formats, including Active Rock, Adult Album Alternative, Adult Contemporary, Country, Classic Country, Classic Hits, Classic Rock, Contemporary Hits Radio, News/Talk, Oldies and Urban Contemporary. In operating its stations, Saga concentrates on the development of strong decentralized local management, which is responsible for the day-to-day operations of the stations in their market area and is compensated based on their financial performance as well as other performance factors that are deemed to effect the long-term ability of the stations to achieve financial objectives. Saga began operations in 1986 and became a publicly traded company in December 1992. The stock trades on NASDAQ under the ticker symbol “SGA”.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Jacob Mutchler, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Solid Q3 results. The company reported Q3 revenue of $29 million, and adj. EBITDA of $5 million, both of which were in-line with our estimates of $28.9 million and $5 million, respectively. Notably, the company’s national advertising revenue was up 1% in the quarter, which is virtually unheard of among its peers. We believe that the company will have among the best Q3 results in the industry.
Best in class. Management indicated that its Digital businesses grew a strong 34% in the quarter, likely to exceed the industry. Notably, the company’s national advertising revenue is up an impressive 6.9% year-to-date. In addition to the company’s industry leading digital revenue growth and resilient national advertising revenues, the company has a pristine balance sheet with no long term debt.
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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.
