In this article, we will talk about the 10 best broadcasting stocks to buy.
Current Dynamics in the Global Broadcasting Market
Technological advancements have transformed the global broadcasting market, just as much as any other industry. Innovation has elevated the broadcasting experience for an average viewer, offering a wide range of rich and high-quality content. Hence, in 2022, we had a global broadcasting market valued at $343.35 billion, as reported by Grand View Research. By 2030, this number could reach $448.34 billion, growing at a compound annual growth rate of 3.9% through the forecast.
As machine learning and AI help gain companies a competitive edge, AI-powered solutions are being used in broadcasting to enhance video quality, streamline live broadcasts, and personalize user experiences.
For instance, Korbyt, a workplace experience platform, recently launched its Machine Learning Broadcast solution, which uses an AI-powered camera to adjust content based on viewer engagement. In essence, it uses smart technology to show different content on screens based on who’s watching and how they react. So, if people are spending a lot of time looking at a certain ad, Korbyt might show that ad more often. It can even optimize recommendations according to people’s preferences and create new content for them.
The global advertising and broadcast industries are also close and benefit from one another. One impact currently is the surge in political advertising spending on broadcasting platforms due to the US election campaign. As the demand for advertising space across various platforms rises, advertising rates for broadcasting companies with increase and boost their revenues.
Forbes reported that the total spending reached $8.5 billion across TV, radio, and digital media in the last election cycle. This was 30% higher than the $6.7 billion projected earlier that year, and 108% more than spending in 2017-2018, which was a record at that time. GroupM projects a record-breaking $15.9 billion investment in political ad spending for the end of 2024.
As campaigns intensify their advertising efforts, especially in the weeks preceding the election, broadcast companies can anticipate a significant rise in revenue, given the heightened demand for airtime to reach voters.
According to Emarketer, 45% of the total digital political ad spending will be seen on CTV (connected TV). As major companies in the networking, entertainment, and streaming industry continue their ban on political content, the major benefit of this spending will go to broadcasting companies.
Goldman Sachs’ Jonny Fine, the global head of investment grade debt, in a recent discussion, mentioned that the US election will likely be a big market event. He says that the outcome could most definitely differ depending on which candidate emerges victorious, but investors need to be prepared for the potential market volatility nonetheless. However, when it comes to realizing short-term gains from elections, the 2019-2020 US election cycle advertising spending validates the projections for this year.
The Business Research Company reports that North America dominated the broadcast market in 2023, but Asia-Pacific is expected to grow the fastest in the coming years. With a promising growth potential, this industry can reward those who watch it closely and observe its dynamics. In this context, we are here with a list of the 10 best broadcasting stocks to buy.
Methodology
To compile our list, we sifted through ETFs, stock screeners and online rankings to compile a list of 15 best broadcasting stocks to buy. We then selected the 10 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q2 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Broadcasting Stocks to Buy
10. CuriosityStream Inc. (NASDAQ:CURI)
Market Cap: $71.53 million
Number of Hedge Fund Holders: 3
CuriosityStream Inc. (NASDAQ:CURI) is a streaming service with a focus on educational content. It offers many documentaries, series, and courses on topics of science, history, nature, and technology.
In the second quarter of 2024, the company increased its direct subscription revenue sequentially and year-over-year. The direct business generated $9.8 million, up 17% from a year ago and 3% from Q1. This resulted in a total revenue of $12.40 million for the company in Q2. The loss per share was $0.04.
In Q2, the company announced a $4 million share repurchase program, with plans to buy back shares through open market purchases or private negotiations. It successfully repurchased 22,001 shares, has no expiration date, and can be modified or stopped at any time.
CuriosityStream Inc. (NASDAQ:CURI) teamed with Estrella MediaCo. to launch the first 3 Spanish-language FAST channels on Samsung TV Plus. It also launched a distribution partnership with Harbour Rights, a company in Hong Kong, to bring premium content to platforms like TV, VOD, and inflight entertainment across Asia. 3 new programming initiatives were taken to enhance content discoverability and promotion, and other original series and specials were premiered.
Management says that the company is exploring licensing its assets (like footage, programs, audio, code, and images) to different GenAI companies, like Google and OpenAI, to sell or rent the rights to its content for training LLMs. With such plans to expand innovatively, the company can be expected to reward those who invest in it. This makes it one of our top broadcasting stocks to buy.
Of its 3 hedge fund holders, Renaissance Technologies has the biggest stake with a value of $458,424 as of June 30.
9. Saga Communications, Inc. (NASDAQ:SGA)
Market Cap: $95.40 million
Number of Hedge Fund Holders: 5
Saga Communications, Inc. (NASDAQ:SGA) is devoted to acquiring, developing, and operating broadcast properties. It owns and operates radio and television stations to broadcast shows, news, music, and advertisements over the airwaves.
Two main revenue contributors for the company are its ‘streaming’ and ‘best of’ segments. Streaming was up 34%, and the best of program, which is essentially just a community online voting process for burgers, dentists, and so on, was up 15%. Despite these surges, the year-over-year growth fell 1.48%, generating a revenue of $28.74 million in Q2. The earnings per share were $0.4.
Saga Communications, Inc. (NASDAQ:SGA) is also expanding its services into online news and community sites in 18 markets, inspired by the need for local news during deployments. The first online news site, ClarksvilleNOW, prioritizes practical local news and avoids opinion pieces and in-depth investigative reporting.
The company expects to report its financial performance on a “same-station basis”, as it purchased a group of radio stations in Lafayette, Indiana in Q2.
The company is building a community by fostering connections through initiatives like the one where listeners share their struggles with a radio personality and seek support. With an emphasis on hyper-local coverage and community involvement, this company can expect exponential growth. As its expenses are also stabilizing, there’s room for future growth, making this a top broadcasting stock to buy.
The stock is held by 5 hedge funds, and Minerva Advisors has the largest stake with a value of $3,617,397, as of June 30.
Merion Road Capital stated the following regarding Saga Communications, Inc. (NASDAQ:SGA) in its fourth quarter 2023 investor letter:
“Like the broader small-capitalization market, most (all) of our returns came in December. Unlike the index, however, this was driven by a few catalysts that positively impacted our portfolio. Entering December our second largest position was in an oil and gas company, Unit Corp (“UNTC”). UNTC declared a special and common dividend equal to 40% of its then market capitalization. Similar to UNTC, our position in the small radio broadcaster, Saga Communications, Inc. (NASDAQ:SGA), benefitted from a special dividend equal to 10% of its then market capitalization.”
8. Urban One Inc. (NASDAQ:UONE)
Market Cap: $99.10 million
Number of Hedge Fund Holders: 5
Urban One Inc. (NASDAQ:UONE) is the largest African-American-owned broadcasting company in the US, with over 50 radio stations. It provides content, entertainment, and services that resonate with its African American audience.
The company launched TV One and CLEO TV on its Xfinity TV Now service, which will likely broaden its audience reach. It is benefiting from the current political climate, by anticipating a boost in political advertising revenue. This is especially important as Q2 advertising revenue was down 26.7%.
The company has been struggling with its cable TV and digital segment revenue, with a 21% and 16% drop respectively. Resultantly, there was a year-to-year drop of 9.2%. On a same-station basis, the revenue fell 3%. The revenue recorded was $117.7 million, with a loss per share of $0.94. Some of these drops were offset by a 7.2% year-over-year increase in radio broadcasting revenue.
The company is currently focused on mitigating the challenges in the cable television sector by using new technology. A specific measure was using a connected TV ad server, improving the monetization of digital advertising inventory.
While it faces significant challenges, Urban One Inc. (NASDAQ:UONE) is adapting to changing market conditions through strategic plans. As it works towards deleveraging its balance sheet, having repurchased $35.5 million of its 2028 notes at a discount, we can see how the company is expected to grow soon. This makes it a top broadcasting stock to buy now.
5 hedge fund holders have long positions in the company. Renaissance Technologies is the largest hedge fund holder with a position of $464,858, as of June 30.
7. Sinclair Inc. (NASDAQ:SBGI)
Market Cap: $943.64 million
Number of Hedge Fund Holders: 10
Sinclair Inc. (NASDAQ:SBGI) is a telecommunications conglomerate and a leading television broadcasting company that provides local news and entertainment, committed to quality journalism.
It is expanding its podcast division with new sports shows featuring top athletes and coaches. It aims to provide exclusive access to the stories of athletes and games. The company has 183 operating stations covering 38% of US television households. Over 50% of their news operations rank number one or two.
The company believes that 80% of adults (18 or older) spend an average of 4 hours per day watching broadcast television. Live sports programming is one of the most important assets here. 97/100 most-watched telecasts in 2023 were on broadcast TV, with 96 being sports content. Therefore, it expects strong sports ratings from the biggest events of the year, as evidenced by the Paris Summer Olympics ratings on NBC, which are up 80% compared to the 2021 games.
By August, the company had $146 million in political advertising booked for the second half of 2024, almost double the amount in 2020. Driven through these events, the Q2 2024 revenue also looked good at $829.00 million, projecting an 8% year-over-year growth. The earnings per share were $0.27.
Sinclair Inc. (NASDAQ:SBGI) partnered with Feeding America to help provide 1.2 million meals to children and families, with $25,000 donations to the campaign. It also won the National Edward R. Murrow Awards for outstanding journalism at WCHS and WPDE television stations. Earlier this year, 15 of its content centers were honored with Regional Edward R. Murrow Awards. Such moves and achievements highlight that the company is positioned for further growth, making it a top broadcasting stock to buy. The company is held by 10 hedge funds, as of Q2 2024.
6. FuboTV Inc. (NYSE:FUBO)
Market Cap: $610.93 million
Number of Hedge Fund Holders: 13
FuboTV Inc. (NYSE:FUBO) is a streaming television service focusing primarily on live sports channels, providing a convenient and accessible way for viewers to watch their favorite games and other live television content.
The streaming service has won a significant victory against a proposed joint venture by Disney, Fox, and Warner Bros. Discovery. This would have controlled a significant portion of live broadcast sports content, potentially harming the company’s business. The CEO, David Gandler, argued that this venture would have deprived consumers of choice and hindered the company’s success. Following the judge’s ruling, the joint venture is unlikely to proceed.
FuboTV Inc. (NYSE:FUBO) expects North American subscribers in 2024 to grow 7% year-over-year at the midpoint. The projected number of subscribers is between 1.725 million and 1.745 million. The company reported strong financial results for Q2 in North America. Total revenue increased by 25.01% to $390.97 million, and paid subscribers grew by 24% to 1.45 million. The advertising business revenue rose 14% to $25.8 million. The loss per share was $0.04.
It launched Fubo Free, a free ad-supported streaming service with nearly 200 channels. This service is currently available to certain former Fubo paid and free trial subscribers. Users can reactivate their paid subscriptions at any time. The company plans to expand Fubo Free to other cohorts in the future.
It repurchased $46.9 million of convertible debt and issued stock to fund these repurchases. This strategic move reduced debt, enhanced shareholder value, and increased financial flexibility. The company remains focused on providing consumers with a premium sports entertainment offering at an affordable price. Such commitments and strides make this company a top broadcasting stock to buy.
Currently, 13 hedge fund holders have invested in the company. Highbridge Capital Management is the largest one with a position of $11,975,000, as of June 30.
5. iHeart Media Inc. (NASDAQ:IHRT)
Market Cap: $229.76 million
Number of Hedge Fund Holders: 14
iHeart Media Inc. (NASDAQ:IHRT) is a mass media corporation dominant in the radio broadcasting industry. It provides listeners with many music and entertainment options through traditional and digital channels.
The Digital Audio Group is a big segment for the company, with a 31% contribution to the total revenue in just Q2. This also represented a 10% year-over-year improvement in the segment. Within the Digital Audio Group, podcast revenues grew 8%, whereas non-podcast revenues rose 10%.
However, the company’s overall revenue improvement was only 1% year-over-year. The revenue resultantly was $929.09 million, higher than what analysts had anticipated, but almost flat compared to the last year. This 1% revenue growth was driven by political ad mainly, and if that segment had not been considered, the overall year-over-year revenue increase would only be 0.1%. Moreover, the loss per share in Q2 was $6.50.
It is the exclusive audio partner for NBC’s 2024 Summer Olympics coverage. This includes a new podcast and live streaming. Under a recent partnership between iHeartPodcasts, Universal Television, and Wolf Entertainment, “Law & Order: Criminal Justice System” will be distributed by iHeartPodcasts. This is the first-ever investigative true-crime podcast series by Law & Order, premiering on August 22.
The company has a strong broadcast radio foundation, which helped it build the iHeartRadio app, a leading digital radio service, and a live events business. When we see that iHeart Media Inc. (NASDAQ:IHRT) reached 110 million Americans monthly through 3,000+ websites, and has increased its social media presence 7 times, we can tell that the company is positioned for success in the broadcast industry. This is why it makes it to our top broadcasting stocks to buy.
Of 14 hedge fund holders, AQR Capital Management has the largest stake in the company, as of June 30. It has a position of $4,261,605.
Palm Harbour Capital made the following comment about iHeartMedia, Inc. (NASDAQ:IHRT) in its Q1 2023 investor letter:
“The second largest detractor was iHeartMedia, Inc. (NASDAQ:IHRT) (-37.5% -58 bps), the American radio and podcasting company. The company suffered two self-inflicted wounds, which will impact the first quarter. The first, which the company flagged as temporary was a change in sales incentives. Apparently, they changed their sales force behaviour to sell more lower margin products at the expense of higher margin products (where management believed it should have been incremental volumes of lower margin not a switch). The second was their guidance for interest rate expense. The company did not hedge their floating term loan and is suffering from the higher interest rate environment, something you do not want to see in a highly levered company. Their debt maturities are years out, but every quarter that passes where free cashflow is low will make refinancing more difficult. Up until now, the company has been executing well, and their podcast business is growing strongly. Management has also been buying shares and we believe their major shareholder, if allowed by the Federal Trade Commission, is potentially interested in owning the business.”
4. E.W. Scripps Company (NASDAQ:SSP)
Market Cap: $177.12 million
Number of Hedge Fund Holders: 20
E.W. Scripps Company (NASDAQ:SSP) is a former media conglomerate that started as a chain of daily newspapers and now specializes in many services, from local television broadcasting to digital media and national networks.
Like most broadcasting companies, E.W. Scripps Company (NASDAQ:SSP) believes its 2024 Local Media election-year political advertising revenue will reach record levels, even with a low-end range of $270-$290 million.
Its core revenue was impacted by political advertising, a tougher NBA comparison, and a transition away from a national rep firm together. CTV revenue increased 11% but was impacted by market dynamics and discounted rates from Amazon and Netflix, so the overall year-over-year revenue fell by 1.58%.
So, E.W. Scripps Company (NASDAQ:SSP) recorded revenue that was less than street estimates for Q2, $573.63 million. The loss per share for this period was $0.15. However, Q3 revenue is expected to be up by 20%. The company has since lowered its expectations for connected TV revenue.
Viewership of the WNBA has skyrocketed and the revenue is up 85% from the 2023 season. It also recently signed the newest Stanley Cup champions, the Florida Panthers, to a production, sales, and distribution rights agreement. The Panthers are the third National Hockey League team to partner with Scripps Sports for broadcast rights.
The company’s Bounce television network, whose programming is created for Black audiences, has had a compound annual growth rate of 14% since 2017. The company is working to reduce expenses and improve profitability. For instance, capital expenditures are expected to be lower than previous guidance. With a focus on debt reduction, it is on track for future growth, making it one of the best broadcasting stocks to buy.
20 hedge fund holders were long SSP, and D E Shaw has the largest stake with a value of $10,388,458, as of June 30.
Cove Street Capital Small Cap Value Fund stated the following regarding The E.W. Scripps Company (NASDAQ:SSP) in its Q2 2024 investor letter:
“The E.W. Scripps Company (NASDAQ:SSP) is too stupid cheap and too levered. We think both will be relieved to a great degree by an upcoming sale of their Bounce network, which could be sold for more than their current market cap. We also note Berkshire Hathaway and the Scripps family are key variables here being underestimated in the public opinion of balance sheet resolution for the company. A complete miss in national advertising trends in the past year has developed into a hairier balance sheet to which we generally feel comfortable. We again have been slowly in and out of the equity several times over the past seven years with solid results. This time around has been a little stickier.”
3. Gray Television, Inc. (NYSE:GTN)
Market Cap: $518.80 million
Number of Hedge Fund Holders: 22
Gray Television, Inc. (NYSE:GTN) is a broadcasting company operating in around 180 stations across the US, focusing on providing local news, entertainment, and quality journalism.
It has signed its first long-term studio lease with a major studio company. The lease is for multiple stages within Assembly Studios and will support a new episodic television drama for one of the Big Four broadcast networks.
In Q2, core advertising revenue was below guidance, 1.5% lower compared to 2023. This difference was partially due to the absence of NCAA final four games, which were broadcast in 2023 but not in 2024. However, the political advertising revenue surpassed the previous Presidential election year. These shifts resulted in a revenue of $825.00 million for Q2, which despite being lower than street estimates, projected a 1.6% year-over-year increase. The earnings per share were $0.09.
Still, Q3 projections are not very high because growth will mostly come from the Olympics advertising revenue alone. The company’s 56 NBC affiliates will generate approximately $19 million.
The company announced a live broadcast of the Harlem Globetrotters game and launched new networks in Ohio and South Carolina. It also announced that unions have ratified new collective bargaining agreements for workers in the film and television production industry at the Assembly. It has comprehensive coverage plans for the 2024 Democratic National Convention, carried on Gray’s local affiliates and Local News Live.
In just August, Gray Television, Inc. (NYSE:GTN) received 8 National Edward R. Murrow awards for excellence in journalism. Such awards highlight the company’s commitment to quality journalism and its impact on local communities, making this one of the best broadcasting stocks to buy.
22 hedge fund holders held long positions this company. The largest stake is held by Darsana Capital Partners with a value of $21,278,728, as of June 30.
Miller Value Deep Value Strategy stated the following regarding Gray Television, Inc. (NYSE:GTN) in its Q2 2024 investor letter:
“Our two largest detractors during the quarter were Nabors Industries (NBR) and Gray Television, Inc. (NYSE:GTN), whose share prices were down 17% and 16% respectively during the quarter. We think both company’s share prices are at deep discounts to their long-term fundamental value; we have recently increased both holdings.
Gray Television remained under pressure during Q2, with ongoing marketplace concerns on the company debt leverage. Gray has limited maturities over the next 2 years and recently announced an opportunistic debt repurchase program. After a slow start to political advertising due to weaker than expected primaries, we expect to see a nice ramp in political advertising in the back half of the year. Gray’s strong local TV stations, #1 and/or #2 in 89% of their markets, has the company well positioned to achieve $500-700M in high margin political advertising in 2024. In addition, Gray has been outpacing peers in growing their core business over the past couple of years and still appear to be in the early innings of an improvement cycle. Management has recently retrained their salesforce with a greater focus on expanding their high margin digital market share over the next couple of years. In addition, ATSC 3.0 (industry new IP standard), provides opportunity for Gray to stream more content and capture new high margin digital revenue streams overtime. We see the potential for $2.5B of free cash flow generation over the next 5 years that could allow the company to rapidly de-lever their balance sheet and accrue value to the equity holder. With a greater than 80% earnings and free cash flow yield, and an attractive 6.2% dividend yield, we believe patient investors have potential to be rewarded over the coming years.”
2. Tegna Inc. (NYSE:TGNA)
Market Cap: $2.37 billion
Number of Hedge Fund Holders: 31
Tegna Inc. (NYSE:TGNA) is a broadcast, digital media, and marketing services company that provides local news and entertainment.
It has received 10 National 2024 Edward R. Murrow Awards. KARE, a television station of the company, was recognized for Overall Excellence for the 3rd consecutive year.
The company’s previously exhibited subscriber and national advertising declines continued in Q2 to accelerate, partially offset by political advertising. The drop in each was 7% and 3% respectively. These declines caused a year-over-year decline of $2.89%. However, it was still able to record a revenue of $710.36 million. The earnings per share were $0.50. This is mostly because local advertising remains strong, driven by small and medium businesses.
The company expects significant political ad spending due to the recent events in the Democratic primaries. By Q2, the company saw an increase in political advertising revenue to $31.6 million from $6 million in the previous year.
Premion, a CTV sales platform of the company, is well-positioned to capitalize on the growing local market adoption of CTV advertising. It is also capitalizing on the return of local sports content to broadcast, as shown by its recent deals with sports teams. Tegna Inc. (NYSE:TGNA) highlighted the early success of the Summer Olympics in Paris and the expanded distribution of WNBA Indiana Fever and NHL Seattle Kraken games in this context.
The company has been going through major leadership changes as of August with the appointment of a new President, CEO, and director, Mike Steib. Such changes show that the company is preparing itself for improvements where necessary for growth. Hence, it is a top broadcasting stock to buy.
The company is held by 31 hedge fund holders. As of June 30, AQR Capital Management is the biggest one, with a value of $48,585,722
1. Nexstar Media Group Inc. (NASDAQ:NXST)
Market Cap: $5.51 billion
Number of Hedge Fund Holders: 34
Nexstar Media Group Inc. (NASDAQ:NXST) is a media company that broadcasts local news and entertainment, with a commitment to quality journalism.
On June 1, the company launched NewsNation, a 24/7 cable news network, providing live coverage of recent news events. The company is expanding content offerings with new premier shows like Trivial Pursuit and Scrabble, and renewed series like All American and Wildcard. It has also secured the rights to broadcast PAC-12 football games and the 2024 Snoop Dog Arizona Bowl on The CW. It’s expanding its CW network affiliation, with 3 additional stations.
Q2 looked great as the distribution and advertising revenue rose. Political advertising generated a record revenue through comprehensive political news and live debate coverage, while non-political advertising sequentially improved. Overall, these improvements resulted in 2.34% year-over-year growth in the second quarter, translating into a revenue of $1.27 billion. The earnings per share were $3.54.
Recently, there have been instances of insider selling. President of Networks, Sean Compton, sold 3,930 shares on August 16, with 10,684 remaining shares. Executive VP and CRO, Michael Strober, sold all of his shares on August 21. A director at the company, Armstrong D Geoffrey, sold 3,505 shares on August 26. He now owns 9,250 shares. Executive VP and General Counsel, Rachel Morgan, sold all of her shares on August 27. Such instances indicate concerns about Nexstar Media Group Inc.’s (NASDAQ:NXST) prospects.
Yet, the company and its partner stations earned multiple awards for journalistic excellence over time which improved trust in the company. Its expansion strategies also position the company for substantial growth, making it one of the best broadcasting stocks to buy.
Currently, 34 hedge funds have positions in this company. Citadel Investment Group is the biggest stakeholder with a position of $113,527,100.
Here is what Richie Capital Group has to say about Nexstar Media Group, Inc. (NASDAQ:NXST) in its Q1 2022 investor letter:
“Nexstar Media Group (NXST up 24.8%) – The television broadcasting and digital media company surged during the quarter after presenting at an investor conference where management pointed to a strong 2022 for both political advertising and retransmission. They have exposure to more than 80% of markets with competitive mid-term political races. NXST is developing new ad categories such as sports betting and they are focused on expanding digital ad revenue and providing digital solutions to local advertisers. Auto advertising will return in the fall as auto dealerships re-enter the market to sell their replenished inventory.”
While we acknowledge the growth potential of Nexstar Media Group Inc. (NASDAQ:NXST), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
