Morgan Stanley analyst Cameron McVeigh maintained a Hold rating on Clear Channel Outdoor today and set a price target of $1.75.
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Cameron McVeigh has given his Hold rating due to a combination of factors including Clear Channel Outdoor’s strategic plans and current financial position. The company has outlined a long-term strategy to grow revenue at a compound annual growth rate of 4-5% through 2028, focusing on digital transformation and investment in airports. However, despite these positive growth prospects, the company’s high debt levels and the potential for a slower local advertising market present significant risks.
While Clear Channel is making strides in reducing its debt and expanding its margins, the current leverage remains high compared to its peers. The stock trades at a forward EBITDA multiple that is competitive but is weighed down by a high net debt to EBITDA ratio. These factors contribute to the Hold rating, as the potential for growth is balanced by financial risks and market uncertainties. McVeigh’s cautious stance reflects the need for Clear Channel to achieve its strategic goals while managing its debt levels effectively.
In another report released yesterday, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $1.50 price target.