Johannes Salim, CFA
CFA, long/short equity, hedge fund manager

Gray Television: The Unlikely Winner Amid Adverse Industry Regulation

Last Monday, Federal Communications Commission (FCC) issued a new regulation that adversely impacts the overall broadcasting sector. Share prices of local broadcasting companies have declined by 22-32% YTD due to anticipation of the new regulation (rising regulatory risk premium). Having investigated the issue over the past month, I believe that Gray Television (NYSE:GTN), unlike its peers, is likely to emerge relatively unscathed or even stronger, fundamental-wise.

New FCC regulation in place

The big breaking news for the broadcasting sector last Monday was that FCC issued a new order regarding joint sales agreement (JSA). In short, FCC bans JSA by two local television stations in the same market in which a station sells 15% or more of advertising time...

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