TVL - LinTV

[Packer16]

I am surprised by the continued decline of TVL (It is at 2.2x FCF wo the acquistion and 1.4x FCF w the acquistion).  There have been a few 10b (5) 1 sales by management for which the price has declined into.  Either this thing is going to blow-up or bounce back once the election revenues start to kick in.  Given its size, I am surprised there is no hedge fund support. 

 

Packer

[Packer16]

Another good quarter with $27 million of FCF and $45 million of EBITDA.  Nothing new but election revenue is picking up nicely and the current value is 3.1x TTM FCF and 5.4x TTM EBITDA and 2.1x TTM FCF and 5.7x TTM EBITDA (w 50% of synergies).  The market must think TVL is going the way of newspapers with these types of multiples.

 

Packer   

[Packer16]

Another cash flowing quarter with 9mos FCF @ $66m and an additional $67 million expected in Q4.  The TTM EBITDA is $200m with $235m 2012 guidance.  These values imply a 4.9x EBITDA multiple and 2.2x FCF multiple.  The cash flow has kept up with the stock appreciation so we are at the same mulitples as Aug.  Just incredable.

 

Packer

[hyten1]

packer i know you quite a lot about the media biz, with a few investment in the space

 

i was wondering if you ever look at SSP?

 

i am new to this space trying to understand it more, i was looking at lin tv

[Packer16]

SSP is an interesting company similar to JRN with a large part of their earnings from broadcasting versus publishing.  SSP also has a lower 2-yr forward EBITDA multiple than JRN and comparable to TVL at about 6.0x.  They also have more "firepower" if they want to purchase more TV stations. The only down side if there is one is low leverage which leads to a higher equity FCF yield of 9%.

 

Packer

[Packer16]

This stock has taken another swoon while the rest of the TVs rally.  It is one of the higher quality properties but sells at a discount EBITDA multiple of 6.3x and a FCF multiple of 4.4x.  It is interesting to hear the reactions to Areo.  Fox wants to put higher quality programming on cable via affiliates and CBS wants to set up a subscription based mobile platform via affiliates.  These sound like nice new rev streams for non-capital intensive affiliates.

 

Packer

[Packer16]

An OK quarter but still cheaper than the other TVs (6.7x 2-yr EBITDA versus 8 to 10x for the other comps).  The conversion to an LLC may be putting a drag on this one but the transaction will hopefully be done by Q3 so they can be back in the M&A furry as a seller or a buyer. 

 

Packer

[Cunninghamew]

Packer,

 

This just came to my inbox so I thought I would post it for your sake (may be junk). Below are the Gabelli comments and the research report is attached

 

Lin Media (TVL - Hold - $12.17)

 

* We believe that LIN is a well-run broadcaster that is expanding its digitial marketing services reach. TVL could be a meaningful participant in the Local TV LLC auction. Subject to price, we think LIN may be advantaged because of very limited market overlaps that may constrain competitors and afford TVL more flexibility.

 

* LIN could potentially use an acquisition in conjunction with accomodating financial markets to refinance its high-cost debt and possible strengthen its balance sheet further by issuing equity.

 

* At current stock prices, the company begins to incur meaninful tax liabilities with conversion, and each $1 per share increase above an $11.85 stock price equiates to ~$20 million. Thus, we reccomend investors Hold TVL.

TVL_05-15-13.pdf

[Packer16]

Interesting that they have PMV at $20 or greater and are recommending hold due to potential tax liabilities for LLC restructure. 

 

Packer

[tombgrt]

http://www.heraldonline.com/2013/07/30/5065763/lin-tv-corp-announces-second-quarter.html

 

Q2 results.

 

Any comments Packer? :) TIA

[Packer16]

Revenues were lower than expectations but I was impressed with the 5% same station revenue growth ex-political.  Apparently they are having the LLC merger vote now so if that is approved and if management appoved the deal then everyone's incentives are for higher prices.  At current prices, the additional taxes are about $53 million.  This is not punative so I think they should just approve the merger and move on.  The did file a prospectus to issue up to $400 million of securites so they may have a transaction in mind.  Currently, they are closer to fair value (probably in the low 20s) than in the past.  This name may be more volatile given the margin of safety is lower.

 

They approvewd the merger an will pay the taxes ($48 million) later this year if they are still around.  They will change their symbol to LIN as of tommorow. 

 

Packer

[tombgrt]

Packer, I forgot to thank you for your comment. So.. Thank you once again! ;)

[Packer16]

This one may have further to go incredible:

 

http://online.barrons.com/article/SB50001424052748703320204579081093209623788.html#text.print

 

Packer

[fareastwarriors]

 

 

http://www.bloomberg.com/news/2013-10-09/sinclair-seen-weighing-gray-takeover-after-losing-belo-real-m-a.html

 

 

Sinclair Seen Weighing Gray Takeover After Losing Belo:

 

 

 

Lin, Gray and Raycom may be among companies that Sinclair could consider buying all or parts of, Sweeney said. Lin, the owner of 43 TV stations, has a market value of $1.2 billion, and Gray is valued at about $400 million. Since Gannett announced the acquisition of Belo, Gray has climbed 27 percent and Lin surged 84 percent as investors anticipated the wave of mergers would continue. Raycom is controlled by its employees and owns or provides services for 53 stations.