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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Dale Baker who wrote (23365)	2/15/2006 5:00:45 PM
From: Paul Senior	Respond to of 78644

About SGA and tv/radio stations. Yes, I have an opinion...don't listen to me. I've been very wrong on this sector the past couple of years, and am taking my lumps for it. As you know, these things don't have bottom line profits or only very little profits, so p/e's are irrelevant. The stocks trade on cash flows mostly generated by station advert. revenues. As the entrepreneurs have bought and sold stations and consolidated the industry over time, there've been multiples paid for those cash flows. This gives some indication of where value is. (private market value) The issue - as I see it anyway - is that there's maybe been a paradigm shift, because ad revenue is shifting from public radio/tv stations to other media (cable, satellite radio) to an extent that people aren't so willing to value the stations as high as they have been valued in past. Whereas I've bought several public radio stations with a view that valuations and stock prices will revert to mean as ad revs increase over time, it surely doesn't look to me like this is going to happen, or happen any time soon. I've averaged down in YBTVA, and sold some last year at loss for tax purposes. I'll likely sell more if stock remains low for remainder of year. I have SBGI since 8/04 which I'm holding at near breakeven. I've seen SGA on the lows list, but given I'm stuck with several losers here already, I've not considered this one. I have assumed SGA business & assets are not much different from any other company's in the sector. But since you mentioned it and I looked at it briefly, that does not seem to be so, as far as results. SGA is consistently profitable (has bottom line profits!). With not too bad profit margins. I'll have to look at SGA closer and consider it. --------------------- I'm also suffering with SALM. Here I've added some a little while ago as stock has dropped along with others. I like SALM because it is focused on religious broadcasting and that is different from all the other radio/tv stocks. I am hoping the demographics from SALM business are more favorable - preachers (who buy radio time) and their flocks who are more likely to listen to public radio broadcasts and more likely to be stable in contributing to their religious affiliations. OTOH, SALM too, seems to have erratic business results. I can't decide if it might be because the managers are more religious than businesslike, or if the management is more self-serving than stockholder oriented. -g- Anyway, unless I had a specific and particular reason to buy SGA (I will check it out), my pick for a buy now would be SALM which I am betting will eventually (sigh) trade over $20 again (a 50% gain from current price). finance.yahoo.com

To: Dale Baker who wrote (23365)	2/16/2006 12:03:10 AM
From: Spekulatius	Respond to of 78644

Dale, TV , Radio and Media properties typically get valued on a EBITDA/EV ratio and to a lesser extend on an FCF yield. After a customer look, SGA looks cheaper than most radio stock pears on those metrics.