Clear Channel Posts Better-Than-Expected Sales; Shares Surge

Clear Channel Outdoor delivered better-than-expected sales in the fourth quarter. The outdoor advertising company remains focused on expanding its digital platform and data analytics products.

Clear Channel (CCO) posted a net loss per share of $0.07 during the fourth quarter, which was lower than analysts’ expectations of a net loss per share of $0.18.

Revenue decreased 27.4% year-on-year to $541.4 million, topping analysts’ estimates of $495.9 million. The decrease in 4Q revenues was attributable to restrictions on movement in the company’s operating geographies. Its Americas and Europe segments witnessed year-on-year sales decreases of 25% and 18%, respectively, during the fourth quarter.

For fiscal 2020, the company generated sales of $1.85 billion, down from the $2.68 billion posted in 2019.

Clear Channel CEO William Eccleshare said, “We believe we have entered 2021 in a strong position to capitalize on the expected recovery across our markets as we gradually emerge from the global pandemic.”

Looking ahead to 1Q, Clear Channel estimates that revenues from the Americas segment will decline by high 20 percentage points year-on-year and Europe segment revenues will decline by mid-30 percent year-on-year. This outlook incorporates the impact of delayed buying decisions from customers. (See Clear Channel stock analysis on TipRanks)

On Feb. 12, Citigroup analyst Jason Bazinet raised Clear Channel’s price target to $2.20 (5.8% upside potential) from $1.60 and reiterated a Hold rating, highlighting the company’s recent debt refinancing and an increased 2022 EBITDA estimate.

Turning to Wall Street, Clear Channel has a Moderate Buy consensus rating based on 1 Buy and 3 Holds. The average analyst price target of $2.07 implies that the stock is fairly priced at current levels. Clear Channel stock has seen a price decline of about 17.5% over the past year.