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Townsquare Media (TSQ)
NYSE:TSQ
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Townsquare Media
(NYSE:TSQ)
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Rating:55Neutral
Price Target:
$7.00
▲(13.45% Upside)
Townsquare Media's stock score is primarily influenced by its financial challenges and technical analysis, which show potential risks. However, the attractive valuation and positive aspects from the earnings call provide some upside potential. The overall score reflects a cautious outlook with significant room for improvement.
Positive Factors
Digital Revenue Growth
The growth in digital revenue indicates a successful shift towards digital platforms, which can provide more scalable and sustainable revenue streams in the long term.
Townsquare Interactive Profit Growth
The significant profit growth and margin expansion in Townsquare Interactive highlight the potential of their subscription-based SaaS business to drive profitability and financial stability.
Debt Reduction
Reducing debt levels improves financial flexibility and reduces interest burden, enhancing the company's ability to invest in growth opportunities.
Negative Factors
Broadcast Revenue Decline
The decline in broadcast revenue reflects challenges in traditional media channels, which may continue to face competitive pressures from digital platforms.
Search Engine Referral Traffic Decline
A decline in search engine referral traffic can limit digital advertising growth, impacting the company's ability to fully capitalize on its digital assets.
High Leverage and Financial Instability
High leverage and negative equity pose risks to financial stability, limiting the company's ability to withstand economic downturns and invest in growth.
Townsquare Media (TSQ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$105.74M
Dividend Yield12.88%
Average Volume (3M)46.81K
Price to Earnings (P/E)3.2
Beta (1Y)0.86
Revenue Growth-0.11%
EPS GrowthN/A
CountryUS
Employees2,049
SectorCommunication Services
Sector Strength97
IndustryAdvertising Agencies
Share Statistics
EPS (TTM)0.09
Shares Outstanding15,130,156
10 Day Avg. Volume46,936
30 Day Avg. Volume46,806
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)-4.45
Price to Sales (P/S)0.31
P/FCF Ratio4.53
Enterprise Value/Market Cap5.87
Enterprise Value/Revenue1.88
Enterprise Value/Gross Profit7.13
Enterprise Value/Ebitda7.51
Forecast
1Y Price Target
$10.00Price Target Upside62.07% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Townsquare Media Business Overview & Revenue Model
Company DescriptionTownsquare Media, Inc. operates as a digital media and marketing solutions company in small and medium-sized businesses. It operates through three segments: Subscription Digital Marketing Solutions, Digital Advertising, and Broadcast Advertising. The Subscription Digital Marketing Solutions segment offers various digital marketing solutions, including hosting, search engine optimization, online directory optimization, e-commerce solutions, online reputation monitoring, social media management, appointment scheduling, payment and invoice, customer management, email marketing, and website retargeting services, as well as traditional and mobile-enabled website design, creation, and development services. The Digital Advertising segment provides digital advertising on its owned and operated digital properties, and digital programmatic advertising platforms, as well as data analytics and management platform. The Broadcast Advertising segment engages in the sale of local radio stations to local, regional, and national spot advertisers, and national network advertisers. As of December 31, 2021, this segment owned and operated 322 radio stations and approximately 330 local websites in 67 local markets. It also owns and operates approximately 200 live events, including concerts, expositions, and other experiential events; and operates local media under the WYRK.com, WJON.com, and NJ101.5.com brands, as well as national music under the XXLmag.com, TasteofCountry.com, UltimateClassicRock.com, and Loudwire.com brands. The company was formerly known as Regent Communications, Inc. and changed its name to Townsquare Media, Inc. in May 2010. Townsquare Media, Inc. was incorporated in 1996 and is headquartered in Purchase, New York.
How the Company Makes MoneyTownsquare Media generates revenue through multiple streams, primarily from advertising sales across its radio stations and digital platforms. The company offers local and national advertisers opportunities to reach targeted audiences through traditional radio ads, digital display advertising, and sponsored content. Additionally, Townsquare Media monetizes its digital assets through programmatic advertising and partnerships with various advertisers. The company also generates income from live events, including concerts and festivals, which attract sponsorships and ticket sales. Significant partnerships with brands and advertisers enhance its revenue potential, and the company's focus on local content and community engagement drives advertiser interest and loyalty.
Townsquare Media Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 10, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of achievements and challenges. Key highlights included strong digital revenue and profit growth, particularly in Townsquare Interactive, and exceeding adjusted EBITDA guidance. However, these positives were balanced by declines in broadcast revenue and challenges in digital advertising growth due to search engine referral traffic declines and external events like Liberation Day and DOGE cuts.Q2-2025 Updates
Positive Updates
Digital Revenue Growth
In the first 6 months of 2025, digital revenue grew by 4% year-over-year, making up 55% of total net revenue. Digital segment profit increased by 9% year-over-year.
Townsquare Interactive Profit Growth
Townsquare Interactive segment profit increased by 19% year-over-year with profit margins expanding to 33%.
Exceeded Adjusted EBITDA Guidance
Q2 adjusted EBITDA increased by 1% year-over-year, exceeding the guidance with a result of $26.4 million.
Strong Programmatic Advertising Performance
Programmatic advertising accounted for 60% of the digital advertising segment's revenue and showed strong organic growth.
Debt Reduction
Repaid $10 million of debt in the second quarter, reducing net leverage to 4.58x.
Negative Updates
Broadcast Revenue Decline
Broadcast advertising net revenue declined by 8% year-over-year excluding political advertising.
Search Engine Referral Traffic Decline
Digital advertising growth was muted due to a decline in search engine referral traffic, impacting indirectly sold digital inventory.
Impact of Liberation Day and DOGE Cuts
Adverse effects on advertising revenue due to Liberation Day and DOGE cuts, particularly in government-related advertising.
Company Guidance
During Townsquare Media's second quarter 2025 conference call, the company reported that its results met or exceeded guidance for total net revenue and adjusted EBITDA. The second quarter net revenue decreased by approximately 2% year-over-year, aligning with the lower end of their guidance, while adjusted EBITDA exceeded expectations with a 1% year-over-year increase. The company's digital revenue grew by 4% in the first half of 2025, contributing significantly to its total net revenue, with digital solutions accounting for 55% of total net revenue. Townsquare's programmatic digital advertising business, Ignite, showed a 2% year-over-year revenue increase despite advertising market challenges. Townsquare Interactive, their subscription-based SaaS business, achieved a 19% year-over-year profit increase, with profit margins expanding to 33%. The broadcast segment saw an 8% year-over-year revenue decline, excluding political advertising. The company expects third-quarter net revenue to range between $106.5 million and $108.5 million and adjusted EBITDA to range from $22 million to $23 million. Townsquare also narrowed its full-year revenue and adjusted EBITDA guidance, remaining within the original parameters set at the year's start.Townsquare Media Financial Statement Overview
Summary
Townsquare Media faces significant financial challenges, with declining revenues, volatile profitability, and a heavily leveraged balance sheet. While operating cash flows are relatively strong, the negative equity position and inconsistent free cash flow generation pose substantial risks.Income Statement
Townsquare Media's income statement reveals a challenging financial position. The company's revenue has declined over the years, with a notable drop from 2022 to 2023. The net profit margin has been inconsistent, swinging from positive to negative, indicating volatile profitability. Gross profit margin is not directly calculable as gross profit equals total revenue, but net income fluctuations suggest margin pressures. Recent EBIT and EBITDA margins have been weak, reflecting operational challenges.45
Neutral
Balance Sheet
The balance sheet shows significant leverage, with a negative stockholders' equity in the latest year, highlighting solvency challenges. The debt-to-equity ratio cannot be calculated due to negative equity, underscoring financial risk. The equity ratio is also negative, indicating the company is more debt-financed. Overall, the balance sheet signals financial instability and high leverage risk.30
Negative
Cash Flow
Cash flow statements offer some positive aspects, despite the overall financial struggles. The operating cash flow to net income ratio is favorable, suggesting good cash flow generation relative to reported earnings. However, free cash flow has been inconsistent, with recent declines. Financing activities have consistently been cash outflows, impacting liquidity. The cash flow analysis indicates moderate performance with room for improvement.55
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 329.43M | 450.98M | 454.23M | 463.08M | 417.96M | 371.34M |
| Gross Profit | 87.00M | 450.98M | 125.03M | 138.15M | 129.66M | 88.99M |
| EBITDA | 82.58M | 41.36M | 9.01M | 72.70M | 101.39M | -60.44M |
| Net Income | 34.99M | -12.70M | -44.96M | 12.34M | 16.74M | -80.55M |
Balance Sheet | ||||||
| Total Assets | 545.73M | 580.41M | 652.05M | 744.52M | 726.31M | 768.50M |
| Cash, Cash Equivalents and Short-Term Investments | 3.18M | 32.99M | 61.05M | 43.42M | 50.51M | 83.23M |
| Total Debt | 490.08M | 53.20M | 552.00M | 578.56M | 587.66M | 595.80M |
| Total Liabilities | 572.82M | 608.86M | 642.14M | 675.44M | 676.73M | 667.75M |
| Stockholders Equity | -30.12M | -31.86M | 6.41M | 65.52M | 46.26M | 97.26M |
Cash Flow | ||||||
| Free Cash Flow | 31.17M | 31.31M | 52.85M | 29.36M | 48.72M | 16.30M |
| Operating Cash Flow | 48.19M | 48.75M | 67.83M | 50.19M | 61.14M | 31.49M |
| Investing Cash Flow | -7.84M | -9.93M | -3.57M | -37.76M | -10.64M | -14.04M |
| Financing Cash Flow | -65.86M | -67.38M | -46.62M | -19.51M | -83.23M | -18.89M |
Townsquare Media Technical Analysis
Negative
6.17
Price Trends
6.85
Negative
7.06
Negative
7.43
Negative
Market Momentum
-0.19
Positive
29.83
Positive
16.57
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSQ, the sentiment is Negative. The current price of 6.17 is below the 20-day moving average (MA) of 6.68, below the 50-day MA of 6.85, and below the 200-day MA of 7.43, indicating a bearish trend. The MACD of -0.19 indicates Positive momentum. The RSI at 29.83 is Positive, neither overbought nor oversold. The STOCH value of 16.57 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSQ.
Townsquare Media Risk Analysis
Townsquare Media disclosed 33 risk factors in its most recent earnings report. Townsquare Media reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Townsquare Media Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.35B | 452.25 | -0.32% | ― | 9.56% | ― | |
70 Outperform | $1.56B | 24.32 | 3.56% | ― | 5.94% | -8.89% | |
65 Neutral | $861.70M | 176.91 | 2.04% | ― | 78.27% | ― | |
63 Neutral | $836.66M | 14.52 | 9.20% | 6.63% | -1.92% | 49.63% | |
61 Neutral | $966.11M | 122.31 | 1.98% | 1.26% | 9.96% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
55 Neutral | $105.74M | 3.19 | 74.55% | 12.88% | -0.11% | ― |
* Communication Services Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.