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It is less than eight weeks until the presidential election in the United States. Viewers in the 8 to 10 "battleground" states will be inundated with political advertising placed by candidates, political action committees (PACs) and the new Super PACs made possible by the 2010 Supreme Court's 'Citizens United' decision. Political Advertising spending in the 2012 election cycle will easily break all previous records.

For years all political advertising placed by or on behalf of a candidate or a committee to elect a candidate airing within sixty days of the general election was placed at the Lowest Unit Charge as required by the FCC. Candidates were entitled to the same lower-margin rate as the stations best and largest year-long advertiser.

But now, for political action committees, television and radio stations can charge higher rates - whatever the market may bear - to accommodate increased demand by PACs and especially Super PACs supported by wealthy individuals.

Who will benefit the most from record setting political revenue? A wide array of businesses profit from political spending, from advertising agencies and marketing companies to media outlets. But especially in 2012 and for the next several weeks, those publicly traded television groups with a coverage footprint which include local markets in battleground states will achieve spectacular political revenue. This is a one-time shot of significant cash flow, all paid in advance.

The following smaller (by market cap) groups are not widely followed but should benefit from this election cycle. Each company profiled has a 52 week change of approximately 50%, compared to the S&P 500 20% change. This isn't unusual for small caps in an up market.

Journal Communications' (NYSE:JRN) market cap is $305 million, with 33 radio stations and 13 television stations in 12 states, including battleground states of Michigan, Wisconsin, Florida and Nevada. Journal Communications' trailing P/E is 13. A healthy 14% is owned by insiders (I like to see skin in the game), and it has a reasonable long term debt of $21 million against a free cash flow of $39 million to service the debt. JRN canceled its dividend in 2009.

LIN Television's (TVL) market cap is $236 million, with 32 network affiliated television stations in 15 markets including battleground states of Michigan, Wisconsin, Virginia and coverage into North Carolina. LIN has a trailing P/E of 3 and carries long term debt of $591 million, serviceable by $57 million in free cash flow. Almost 7% of the company is held by insiders. LIN does not pay a dividend.

Sinclair Broadcast Group's (NASDAQ:SBGI) market cap is $978 million, which owns or provides programming or operational expertise or sales support for 73 television stations in 45 markets including battleground states of Iowa, Wisconsin, Florida, Nevada, Virginia, North Carolina and Michigan. Sinclair has an attractive dividend, paying 4.2%. This is the largest of the three groups profiled and also has the largest long term debt at $1.7 billion. It is serviceable by $205 million in free cash flow. Insiders hold 2% of the company stock.

These companies have wide exposure to markets in battleground states. Each has local news operations highly desired by political advertisers. Cash generated this election cycle will likely enhance the business of each of them.

By generating tens of millions of dollars each election cycle, these groups remain candidates for long term holdings. The battleground states of 2012 were, for the large part, the battleground states of 2008, and will likely be the same in 2016. Since the election of 2000, we've had to wait all night - and sometimes weeks - for the final results from battleground Florida.

With changing demographics in the US, particularly with Hispanic voters, Iowa, Nevada and Colorado will remain battleground states for years to come, enhancing the fortunes of local television stations in those states.

Source: Don't Hate Political Advertising - Profit From It