Saga Communications (SGA), mcap=$149m, price $24.65 vs $23.00

Pitch:
– Well-managed radio broadcaster with 79 FM and 35 AM stations.
– Owned land/buildings/towers with gross book value equivalent to current EV.
– 40% market cap in cash, with nearly all competitors having highly leveraged balance sheets.
– Unlevered FCF yield of 15%.
– Remained profitable through the pandemic.
– Additional cost-cutting measures taken are expected to lead to improved profitability going forward.

Valuation:
– With 8% revenue growth on ’21 expected to generate FCF of $15m.
– DCF results in $135m EV and $190m market cap.

Exp. gain: +40% to $32/share.

Full $SGA write-up (free guest account required):
https://www.valueinvestorsclub.com/idea/SAGA_COMMUNICATIONS_INC/2889162014

Published on: August 28, 2022  •  Published by:
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