The Upside Of Radio As An Investment

Forecast 2020 is coming up November 20 at the Harvard Club in New York City. Prospects for Radio as an Investment in 2020: The Real Street Talk is one of the informative panel discussions on the agenda. On the panel will be Robin Flynn, Managing Director/Research, S&P Global Market Intelligence. She specializes in the valuation and analysis of television, radio, and cable television properties. She shared some insights with Radio Ink.

Radio Ink: What type of stations can be a good investment?
Flynn: Potential investors can still look to radio stations in the mid-to-small markets. There is more upside potential in a well-established or growing mid-to-small market cluster and those stations are less costly to operate. The publicly traded group owners are focusing more of their capital in competing in the big markets and building out their digital businesses.

Radio Ink: Should an investor consider “mom & pop” stations?
Flynn: Yes. The problem is that a lot of those small-market mom & pop stations would be sellers, and are holding out for higher deal multiples which have been elusive of late.

Radio Ink: How can an investor compete with the “Big Box” radio companies?
Flynn: There are many examples across the country of small owners competing with “Big Box” radio companies in the same markets and those owners have been successful with a major focus on serving the local community. Doing on-sites and live events as well as talent being visible in the community goes a long way in building a listener base and gaining local advertisers.

Radio Ink: Before investing in a radio station, what should an investor look at?
Flynn: The market economics and demographics are key along with the quality of the radio station’s signal and the operations. The other factors are the competition and how the station’s revenue and cash flow have trended over the past 3-5 years.

Radio Ink: Is being debt adverse a good or bad trait for someone considering investing in radio?
Flynn: Being debt adverse is of vital importance when considering investing in radio because the top-line revenue growth rates have been flat to down over the past decade. Although leverage was higher during certain periods of the past, 3-4x debt leverage is currently more appropriate for the radio industry.

Don’t miss the rest of what Robin Flynn has to say about prospects for radio as an investment, exclusively at Forecast 2020. She’ll be joined by Paul Homer, Managing Director, Northwood Venture and Paul Miller, Managing Director, Cerberus Capital Management, in a session led by Randy Michaels, CEO of Radioactive, LLC.

See the full agenda for Forecast HERE

Register HERE. Early bird pricing ends October 18.