A new, multi-dimensional approach. This report highlights a recent interview with CEO Mary Berner, who unveiled a new company presentation and its strategic shift toward a multi-dimensional Audio-first media company, rather than its previous Radio-first model. Click here for the full interview. We believe that the company's recent agreement for its 413 stations and podcasts to be on the Audacy digital platform is an example of its multi-platform, multi-dimensional strategy.Multiple revenue streams with large market opportunities. A key component of the company's presentation was to highlight the multiple revenue streams, each with a large market opportunity. While Radio offers a post pandemic advertising recovery, the company's Digital businesses are growing rapidly. In Q2, Digital increased 50% in revenues and accounted for 14% of total company revenues. Management highlighted that Streaming, Podcasting and Digital Marketing Services represent an $18 billion market opportunity.5 Drivers Shareholder Value Creation. While we have considered debt reduction as one of the key drivers toward improved shareholder value, management provided 5 drivers including tailwinds from ongoing radio advertising recovery, strong digital revenue growth, continued cost optimization, accretive M&A and portfolio optimization, and strengthening its balance sheet through rapid de-leveraging.Recent share weakness. Investors seemed to have shunned companies with a relatively high degree of debt leverage. The CMLS shares declined 22% since it reported its second quarter results, which, by the way, over achieved our expectations. Furthermore, at that time, the company provided 2022 cash flow guidance of $175 million to $200 million, which was above our expectations. Debt leverage appears likely to be below 4 times 2022 EBITDA based on management's guidance, a reasonable level which should assuage investor concern over its debt levels.Maintaining Outperform Rating: Near current levels, the CMLS shares trade at a modest 5.1 times Enterprise Value to our full-year 2022 adj. EBITDA estimate. We are holding our outperform rating with a price target of $27 a share. In our opinion, the recent partnerships with WynnBET and Audacy alongside the improved fundamentals secure an expansion in the multiples. As mentioned in earlier reports, we would expect the company to return capital to shareholders in the next 12 to 18 months. Read More >>