overlooked and underrated
Old media stocks such as TEN, FXJ, AEO, have recently been rerated down. Exceptions to this seem to WAN and RUP are still trading on higher multiples 17 and 21 The arguement being that advertising revenue will not be impacted quite so much in regional area as in metropolatan.
SBC is a somewhat in between being a regional and a metropolitan broadcaster. 20% of its revenue comes from metropolitan radio and it gets 60% of its revenue from REGIONAL TV. Huntley says it has "a potential broadcasting exposure of up to 5.8m eyeballs spanning regional NSW, QLD & VIC." Further more the radio part of it's operations seems to have growth prospects.
Huntley says" SBC's other operations include radio broadcasting (20% of revenue) and the production and sales arm, Southern Star (20%). SBC's radio operations have a strong presence in the 40+ demographics with Radio 3AW in Melbourne continuing to rate number one. Additionally, its hourly news service is delivered daily to 178 radio stations in every state, and it has secured the exclusive radio rights to 2006 Melbourne Commonwealth Games. These features represent an opportunity to grow exposure and gain market share. Management expects the radio advertising market will grow by 4% in FY06. " In addition the company has low gearing and could be in a position to buy other assets or get taken over. It doesn't have an owner who has a controlling interest.
SBC Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
