iHeartMedia Stock Price Drop Involved 'Liquidity Questions' Says Wells Fargo's Marci Ryvicker
Cumulus Stock Down, Too
November 6, 2015 at 12:15 PM (PT)
It was hard to miss the drop iHEARTMEDIA experienced on WALL STREET YESTERDAY (11/5). IHRT was down $1.40, closing at $2.00, which was off 41.18%. So far TODAY, the stock continues to slide -- down 25% to $1.50.
ALL ACCESS reported (NET NEWS 11/5) that iHEARTMEDIA third-quarter consolidated net revenue fell 3.1% year-to-year to $1,579,514, but increased by 0.3% to $1,635,009 excluding unfavorable movements in foreign exchange rates. The company's broadcasting division saw revenues rise 2% to $846.8 million (up 3% excluding political revenues), attributed to sponsorship revenue from the iHEARTRADIO MUSIC FESTIVAL, barter and trade revenue, and digital revenue, although core broadcast radio revenue decreased; AMERICAS outdoor rose 1%, as did international outdoor when exchange rates were excluded. Consolidated net loss widened from $108 million to $213 million.
WELLS FARGO SECURITIES analyst MARCI RYVICKER, who doesn't cover iHEARTMEDIA, but does track CLEAR CHANNEL OUTDOOR was on the company's financial call, and noted it, "involved a LOT of questions around IHRT’s liquidity situation. High yield bond trading levels (mid teens percent YTW) indicate the circumstances are becoming more dire."
She wrote to investors, "given today’s significant underperformance, the market is clearly looking past 'okay' operational trends to focus on the balance sheet, which clearly isn’t strong -- CCO is levered at 6.7x and IHRT levered at 11.5x (11.3x net of cash), begging the question 'what does management do now?'"
An iHEARTMEDIA spokesperson had "no comment" to ALL ACCESS about the stock price.
Meanwhile, at CUMULUS MEDIA, the repercussions from yesterday's Q3 report -- which saw revenue down 7% and EBITDA down 11.5% -- continues to reverberate on WALL STREET. Its stock fell 33% today to $0.29.