ATLANTA - Gray Television, Inc. (NYSE:GTN) has renewed its network affiliation agreements with The Walt Disney Company (NYSE:DIS) for all of its ABC affiliated stations in 25 markets until December 31, 2028. This extension continues a long-standing partnership, allowing Gray's ABC affiliates to maintain their delivery of local and network content to their respective communities. According to InvestingPro data, Gray Television currently trades at a P/E ratio of 1.95, suggesting potential undervaluation relative to peers.
The announcement was made today by Gray's President and Co-CEO, Pat LaPlatney, who expressed satisfaction with the continuation of the relationship, emphasizing the affiliates' dedication to public service. Susi D'Ambra-Coplan, SVP of Affiliate Relations at The Walt Disney Company, also highlighted the mutual commitment to providing quality programming and local service.
The agreement covers a diverse range of markets, including Tampa-St. Pete (Sarasota), Green Bay-Appleton, Toledo, Springfield, MO, Cedar Rapids, Reno, Tyler-Longview, Ft. Wayne, Sioux Falls, Springfield-Holyoke, MA, Peoria, Columbus (WA:CLC), GA-Opelika, AL, Monroe-El Dorado, Wichita Falls & Lawton, Albany, GA, Biloxi-Gulfport, Gainesville, Hattiesburg-Laurel, Rapid City, Harrisonburg, Jonesboro, Bowling Green, Laredo, and Grand Junction-Montrose.
Gray Television, headquartered in Atlanta, Georgia, is a major multimedia company and the largest owner of top-rated local television stations and digital assets in the United States. The company's reach includes approximately 36 percent of U.S. television households, with a presence in 113 television markets. With an EBITDA of $946 million and annual revenue of $3.46 billion, Gray maintains a strong market position. The company offers a notable dividend yield of 10.63% to shareholders. In addition to its television stations, Gray owns Gray Digital Media, a digital marketing agency, and has interests in various video production companies and studio facilities. InvestingPro subscribers have access to 13 additional key insights and a comprehensive Pro Research Report that provides deep-dive analysis of Gray Television's financial health and market position.
This strategic move ensures that Gray's ABC affiliates will continue to deliver network shows, news, and sports programming alongside their local offerings, thus reinforcing their service to the public. With a healthy current ratio of 1.13, the company maintains sufficient liquidity to support its operations. The information for this article is based on a press release statement from Gray Television, Inc. For detailed financial analysis and future growth prospects, visit InvestingPro, where you can access comprehensive valuation metrics and expert insights.
In other recent news, Gray Television experienced a notable revision in its financial outlook. Loop Capital adjusted the company's price target downward to $7.00 from $8.00, while maintaining a Buy rating. This adjustment was due to a less robust broadcast TV political advertising climate than initially anticipated, impacting the company's revenue and EBITDA projections for 2024. Similarly, Benchmark also adjusted Gray Television's price target to $8.00 from the previous $11.00, while sustaining a Buy recommendation.
These changes followed Gray Television's third-quarter revenue hitting the low end of its guidance, and an anticipated shortfall in political revenue by $130 million. Additionally, fourth-quarter revenue forecasts have been affected by hurricanes and the transition of SEC football broadcasting rights from CBS to ABC. This has led to a projected decline in core advertising revenue, overshadowed by political advertising and interruptions due to hurricane events.
Despite these challenges, Gray Media Group reported an 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. Gray Media is now implementing cost-reduction strategies, aiming to reduce operating expenses by $60 million annually, and planning to reduce its total net debt by approximately $500 million in 2024.
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