LAMR

Lamar Advertising Co - Ordinary Shares - Class A

TMT


Presented:12/09/2022
Price:$94.71
Cap:$9.63B
Current Price:$138.11
Cap:$14.13B

Presented

Date12/09/2022
Price$94.71
Market Cap$9.63B
Ent Value$12.73B
P/E Ratio19.42x
Book Value$12.53
Div Yield4.75%
Shares O/S101.68M
Ave Daily Vol578,865
Short Int3.13%

Current

Price$138.11
Market Cap$14.13B
Lamar Advertising Co. engages in advertising services. The firm rents advertising space on billboards, buses, shelters, benches, logo plates, and in airport terminals. The company was founded in 1902 and is headquartered in Baton Rouge, LA.

Publicly traded companies mentioned herein: Lamar Advertising Co (LAMR), Outfront Media Inc (OUT)

Highlights

The presenter is short shares of Lamar Advertising Co (LAMR), an outdoor billboard advertising company with a REIT structure. LAMR is decently levered (3.2x net debt), so there is torque on the equity to both the upside and downside with small EBITDA moves. Therefore, he feels it is an easy long on the way up and an easy short on the way down, the latter of which seems to be playing out. REIT investors don’t find it defensive enough and media investors think it’s too expensive, so there are no real buyers of this cyclical, late cycle stock that hasn’t yet felt an economic impact and is trading near its non-recessionary fair value (13x 2023 consensus EBITDA vs. historical mid-teen EBITDA multiple). In a recessionary scenario, underwriting conservative downward revisions— revenue down 5% and multiple compression to 12x EBITDA— creates his fair value of $70 per share, or 26% downside from the current $95. 

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Idea Discussion

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