In a challenging year for media stocks, Gray Television Inc . (NYSE:GTN) has marked a new 52-week low, with shares dropping to $3.95. According to InvestingPro data, the company trades at compelling valuations with a P/E ratio of 2.57 and offers an attractive dividend yield of 8.02%. The decline reflects a broader trend in the sector, with the company's stock price plummeting by over half, registering a -53.13% change over the past year. Investors have been cautious as the industry faces headwinds from shifting advertising revenues and changes in content consumption patterns. Despite these challenges, InvestingPro analysis suggests the stock is currently undervalued, with the company maintaining strong liquidity and a healthy current ratio of 1.13. Gray Television's recent low underscores the volatility and the pressures faced by traditional media companies in a rapidly evolving digital landscape. InvestingPro subscribers have access to 7 additional key insights about GTN, along with comprehensive analysis in the Pro Research Report, helping investors make more informed decisions in this challenging market environment.
In other recent news, Gray Television's third-quarter revenue hit the low end of its guidance, with a modest increase of 1% in core advertising revenue. However, the company's political revenue is anticipated to fall short of expectations by $130 million. Loop Capital has adjusted its financial outlook for Gray Television, revising the price target downward to $7.00 from the previous $8.00, while still endorsing the stock with a Buy rating. This adjustment follows a reassessment of the company's revenue and EBITDA projections for 2024, which were reduced due to a less robust broadcast TV political advertising climate than initially expected.
In addition, Gray Television's fourth-quarter revenue forecast has been impacted by the hurricanes and the transition of SEC football broadcasting rights from CBS to ABC. Benchmark analyst also adjusted the stock price target for Gray Television, reducing it to $8.00 from the previous $11.00, while maintaining a Buy recommendation. This comes after the company's third-quarter results, which were solid, but coupled with a fourth-quarter core and political advertising revenue guidance that fell short of market expectations.
Gray Media Group, Inc. reported a robust 18% rise in total revenue to $950 million in its Q3 2024 financial results, transitioning from a net loss to a net income of $83 million. The company's adjusted EBITDA surged by 61% to $338 million. Despite certain challenges, Gray Media is implementing cost-reduction strategies projected to reduce operating expenses by $60 million annually and is capitalizing on new media rights deals to enhance its broadcasting portfolio.
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