It’s been an ugly year for most stocks, but for Audacy the pain has been especially acute.
Shares of the radio broadcast and podcasting company on Wednesday dropped to an all-time low of 55 cents per share, falling 5.5% for the day — and down about 84% year-over-year. Audacy now has a market capitalization of just under $80 million.
Wall Street’s bearish stance toward Audacy comes after the company reported second-quarter earnings on Aug. 5 missing expectations. CEO and president David Field blamed “declining macroeconomic conditions and ad market headwinds” for crimping revenue growth. Q2 revenue was $319.4 million, up 5% year over year, while the company posted a pre-tax net loss of $1 million.
“While we navigate the turbulent current market conditions, we are excited by our future growth potential across our scaled, multi-platform businesses,” Field said in announcing the Q2 results. He pointed to Audacy’s expanded podcast and streaming audio networks and the rollout of a new digital platform and ad-tech capabilities in the second half of 2022 that “will enable us to unlock pools of ad demand and supply that we can’t effectively monetize today.”
But analysts remain skeptical that Audacy can turn things around quickly. On Aug. 12, research firm B. Riley cut its forecast for the company’s Q3 earnings, now predicting a loss of 1 cent per share (down from net income of 15 cents per share). The came after B. Riley’s analyst team in July downgraded their rating on Audacy from “buy” to “neutral.”
With Audacy stock at record lows — and trading under $1 per share — it is now at risk of being delisted from the New York Stock Exchange. On Aug. 1, 2022, the company was notified by the exchange that its Class A common stock was not in compliance with the NYSE’s continued listing standard requiring a minimum average closing price of $1.00 per share over 30 consecutive trading days. Audacy now has a six-month “cure period” to regain compliance (under which the stock must have a closing share price of at least $1 per share and an average closing share price of at least $1 over the prior 30 trading-day period).
The Philadelphia-based company changed its name to Audacy Inc. in March 2021 after more than 50 years as Entercom Communications. In 2017, Entercom acquired CBS Radio, establishing it as the No. 2 radio broadcaster (after iHeartMedia) and in 2019 boughtpodcast companies Cadence13 and Pineapple Street Studios.
One area Audacy has targeted as a potential high-growth, high-return business: online betting. The company recently expanded its partnership with BetMGM, which became the official sportsbook of the BetQL Network, Audacy’s network of sports-betting content distributed across broadcast and digital platforms. Under the multiyear pact, BetMGM will have category exclusivity in BetQL Network’s weekly lineup of about 100 hours of original content per week. In addition, Audacy will produce content for live audiences at various MGM Resorts across the U.S.
