On Monday, Guggenheim maintained a positive stance on iHeartMedia (NASDAQ:IHRT) by increasing the stock's price target to $5.00, up from the previous $3.00, while keeping a Buy rating on the shares. The adjustment follows iHeartMedia's third-quarter financial performance and its projections for the future.
iHeartMedia reported third-quarter revenue of $1.008 billion, a 5.8% increase that aligns with the company's guidance for a mid-single-digit rise. Their adjusted EBITDA for the quarter was $205 million, fitting within the guided range of $200 million to $220 million. This report comes in contrast to the analyst's earlier forecast, which anticipated slightly higher figures of $1 billion in revenue and $217 million in adjusted EBITDA.
For the fourth quarter, iHeartMedia has guided for a high-single-digit increase in revenue. The Guggenheim analyst echoes this optimism, projecting a 9% rise in revenue and an adjusted EBITDA of approximately $290 million, slightly below their estimate of $293 million. The full-year 2024 revenue and adjusted EBITDA estimates from Guggenheim are set at $3.90 billion and $753 million, respectively, which is in line with the management's guidance of around $750 million for the full year's EBITDA.
Looking ahead, iHeartMedia has provided guidance for its 2025 adjusted EBITDA, expecting it to be approximately $770 million. The analyst's estimate closely mirrors this figure, coming in at $771 million. This forward-looking optimism is encapsulated by the firm's decision to raise the price target.
In other recent news, iHeartMedia reported a 5.8% increase in consolidated revenues to $1.04 billion in its Q3 2024 Earnings Call, along with an adjusted EBITDA of $205 million. The company also announced a Transaction (JO:TCPJ) Support Agreement with debtholders to extend debt maturities and reduce overall debt. Despite overall growth, there was a slight revenue decline in the Multiplatform Group. Meanwhile, the Digital Audio Group led the revenue growth with a 12.7% increase. BofA Securities upgraded iHeartMedia's shares rating to Neutral and raised the target to $3, based on a more optimistic valuation of the company's expected EBITDA for the year 2025.
InvestingPro Insights
To complement Guggenheim's optimistic outlook on iHeartMedia (NASDAQ:IHRT), recent data from InvestingPro offers additional context for investors. Despite the company's recent financial performance and positive guidance, InvestingPro data reveals that iHeartMedia has not been profitable over the last twelve months, with a negative P/E ratio of -1.05. This aligns with the InvestingPro Tip indicating that analysts do not anticipate the company will be profitable this year.
However, it's worth noting that iHeartMedia's stock has shown strong momentum recently. InvestingPro data highlights a remarkable 55.63% price return over the last three months and an even more impressive 82.64% return over the past six months. This upward trend supports Guggenheim's decision to raise the price target and maintain a Buy rating.
An InvestingPro Tip suggests that iHeartMedia's stock price movements are quite volatile, which could explain the significant recent gains as well as the -11.24% return over the past week. Investors should consider this volatility when evaluating the stock's potential.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for iHeartMedia, providing a deeper understanding of the company's financial health and market position.
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