TPCO - Tribune Publishing (TPCO) - Are The Shares Too Cheap To Ignore?

Overachieves Q2 expectations. Q2 revenues of $183.1 million was slightly better than our $182.4 million estimate. Strong cost cutting actions allowed it to significantly overachieve our cash flow estimate, as measured by adjusted EBITDA, $18.8 million versus our $7.1 million estimate. Q3 guidance better than expected. Management's Q3 revenue guide of $188 million to $193 million is much better than our $181 million estimate. The prospective revenue decline is in line with other traditional media companies and illustrates the strength of its Digital businesses. The Q3 cash flow guide is also well above our expectations, a range of $24 million to $27 million, over 40% better than our $15.6 million estimate. Building cash. As of June 30, the company had $113.9 million in cash, or $3.13 per share, and virtually no debt. Cash is up from $86.1 million as of March 31. We are raising our financial assessment from 3.0 to 3.5, given its burgeoning cash position. Raising full year 2020 and 2021 cash flow estimates. Given improved revenue trends and aggressive cost cutting, we are raising our 2020 revenue estimate to $798.6 million from $784.8 million and our cash flow estimate from $57.0 million to $82.6 million. Raising price target. We are raising our price target from $14 to $15 per share based on the upwardly revised cash flow estimates. Near current levels, the TPCO shares trade at 2.8 times Enterprise Value to our 2021 cash flow estimate. Read More >>