Entering text into the input field will update the search result below

Entravision: Mis-Valued Assets And A Burgeoning Market Make This One Hard To Ignore

William Daniel profile picture
William Daniel


  • Entravision shares are down around 35% since late January.
  • FCC's incentive broadband spectrum auction has illustrated the mis-valuation of the company's assets.
  • Strong tailwinds from mid-term elections and a growing Spanish-language population will help increase revenues and earnings in 2018.
  • With a dividend yield over 4%, EVC is an attractive value play.

Entravision Communication Corporation (NYSE: NYSE:EVC) is a leading diversified global media company that targets a rapidly growing Hispanic population in the U.S. and around the world. Shares of EVC have gone on quite the ride since the beginning of 2018 and are now down around 35% since late January highs of around $7.30/share. With a current dividend yield over 4%, the company is beginning to look increasingly attractive as a deep value play.

ChartEVC data by YCharts

EVC’s higher than average leverage along with inconsistent revenues and earnings have kept investors away for years. Total indebtedness was approximately $299.3 million as of December 31, 2017 and for a company with a market cap hovering around $400 million, this is quite substantial. However, on March 29, 2016, the FCC announced the first ever broadcast incentive auction to “realign the use of public airwaves,” which allowed companies like EVC to sell the rights to their broadcast spectrum so they can be repurposed for 5G wireless services.

EVC permanently sold the spectrum rights to four of its television stations, and was able to net $263.9 million during the process. With current assets on the books at discounted values due to impairment charges that date back to 2006-2008, it has long been assumed that the actual asset value of the company’s broadcast spectrum in particular has been mis-valued. The $263.9 million gained through the sale of only 4 of 55 stations illustrates the true net asset value of the company to be substantially higher than is recorded.

In a market stricken with volatility fever, I am not the type of investor who continually recommends buying the dip, but in every market, whether that be bear, bull or stagnant there are always value plays and I see EVC as one of them. Given that EVC does not expect the broadcast

This article was written by

William Daniel profile picture
Fortune Markets and Economy Reporter. Prev. Business Insider Investing Reporter. MS Business Journalism. I'm mostly a passive investor these days(and I think you probably should be, too), but I still "seek alpha" with a portion of my portfolio.The more I learn, the more I realize just how much I have to learn. Do your own research...blah, blah, blah...*some quotes about investing or something*

Analyst’s Disclosure: I am/we are long EVC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.