Tribune Publishing Cuts Q4 And FY20 Guidance

Tribune Publishing on Dec. 31 lowered its Q420 and FY20 guidance and provided a revenue outlook for FY21, following the closure of the sale of its majority stake in BestReviews to Nexstar Media Group.

For the fourth quarter, Tribune Publishing (TPCO) expects to generate revenue of between $191 million and $192 million, down from the range of between $203 million and $208 million in a previous forecast. Adjusted EBITDA is forecasted between $28 million and $29 million compared to a range of $36 million to $39 million in an earlier outlook.

For the full-year of 2020, the company projected sales to amount to between $745 million and $746. Adjusted EBITDA is expected between $72 million and $73 million versus a previous guidance range of $100 million to $105 million.

Looking ahead to FY21, Tribune sees revenue generating between $675 million and $690 million with adjusted EBITDA of between $105 million and $113 million.

In reaction to Tribune’s announcement on the sale of BestReviews, Noble Financial analyst Michael Kupinski reiterated a Buy rating on the stock on Dec. 17.

Kupinski, who set a price target of $17.50 (almost 28% upside potential), estimated that the company would have $210 million in cash in total following the sale.  

The analyst noted that the company’s shares trade at a modest 2.9 times the enterprise value to proforma estimates based on proforma 2021 cash flow of $79.2 million and the proceeds from the BestReviews sale. (See TPCO stock analysis on TipRanks)

He believes that revenue upside, cash flow surprises, and growing contributions from Tribune’s digital businesses would be among the key catalysts toward higher stock valuations.

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