Sinclair Broadcast Group, Inc. (NASDAQ:SBGI)

CAPS Rating: 3 out of 5

The Company is a diversified television broadcasting company that owns or provides certain programming, operating or sales services to more television stations than any other commercial broadcasting group in the United States.


Player Avatar TSIF (99.96) Submitted: 8/14/2009 3:49:17 PM : Underperform Start Price: $2.11 SBGI Score: -103.68

While insiders are still bullish on Sinclair Broadcasting, the last quarter's results continued to show the lack of advertising spending in this market, local and national. Sinclair indicated that usually the second quarter is one of the best due to auto advertising, but revenues continued to decline. While management has a great track record, their weak cash flow and cash on hand will make debt payments difficult. They indicated in their last earnings report that interest payments on debts will be difficult and cited concerns of partners whose financial position may add to their own problems. Although cash flow is still positive, Sinclairs Negative stockholder's equity and debt concerns, in a business with no positives on the horizon, give it the red thumb from me.

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Member Avatar dragonLZ (99.43) Submitted: 9/10/2009 12:11:31 AM
Recs: 0

Be careful with SBGI. Haven't you seen the big dump-day on 7/14/09? It was down 25% on the highest volume in 12 months (up to that date)?
I think it will continue to go up...

Member Avatar TSIF (99.96) Submitted: 9/10/2009 5:15:57 PM
Recs: 0

What's the basis for your opinion? It sounds like strictly the chart and volume? I'm happy with my call until the fundamentals change or someone points out what I missed in the fundamentals. This was a one year call. Over this timeframe I'll pit fundamentals over technicals. Mr. Market doesn't care over the short run, but technicals don't pay the bills when you have a NEG. $4.28 EPS, a negative net tangible balance sheet and a negative 76% quarterly earnings. All of that in addition to your partners and subsidiaries who have admitted that they are currently illiquid. I will concede that a fundamental change such as a stronger ecomomy and a greater adverstising spend could save them, but I don't see many new car ads and there is a weak political cycle. See you in a 11 months or less.... (P.S. Look for this to be closed by then, you'll see the green points in my closed list)...... :)

Member Avatar kristm (99.74) Submitted: 9/16/2009 2:28:27 PM
Recs: 0

Just like oil, advertising is cyclical - so businesses that generate most (or all) of their revenue from advertising tend to be cyclical as well. Sinclair still has a good position and a strong future when things recover, it's just being beaten down along with (and somewhat beyond) its peers. Buying Sinclair last month is comparable to purchasing Exxon-Mobil during the last period of cheap oil. I picked it on Caps and then picked up some for my real portfolio too. I'm up 70% in only a few weeks and plan to hang on for a while.

Member Avatar TSIF (99.96) Submitted: 9/16/2009 5:10:49 PM
Recs: 0

Good call kristm. I'm not hung up like I use to be on companies with high debt. Debtors don't want to own a business or push anyone into BK. Their partners, however, are also in trouble. Advertising is cyclical, but I don't see the auto industry helping out and elections are in an off year. That leaves retail to need to pony up to the plate. They might try it if consumer confidence stays up. Wherever they pop up to on their share price will probably be stagnant for awhile until they can prove revenue. Again, good luck with your call. Mr. Market seems happy to shore up some o the more beaten down right now. I don't see another correction of any meaningful size anytime soon, so flight from doesn't seem to be a concern.

Member Avatar dragonLZ (99.43) Submitted: 10/14/2009 10:40:26 PM
Recs: 0

SBGI keeps going up...and up...

Member Avatar kristm (99.74) Submitted: 10/16/2009 10:33:11 PM
Recs: 0

Quickest good results I've ever gotten from a stock pick; Sinclair is up over 140% since I bought for my real portfolio and it's still sporting a P/E below 2.

Member Avatar TSIF (99.96) Submitted: 10/20/2009 2:08:13 PM
Recs: 0

kristm, your CAPs score shows that you don't need any advice on P/E, but I would recommend that you review where you get your data. I find the CAPs data to be questionable. The context of the P/E on Sinclair (one quarter of minimal profit by cutting vs the last year of substantial losses) also makes it questionable in the area of accuracy and value. Good luck with your investment. I have no issue if Sinclair proves me wrong. It's got more value than many other speculative stocks that have popped lately.

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