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Outfront Media Inc (OUT)
:OUT
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Outfront Media
(NYSE:OUT)
65Neutral
Positive Factors
Financial Performance
OUTFRONT delivered a strong 4Q, beating expectations on OIBDA and AFFO as digital growth, cost controls, and lower interest expense offset revenue headwinds.
Revenue Growth
Digital investments in inventory and campaign execution increase the attractiveness of the inventory, which can provide support for revenue trends overall.
Negative Factors
Financial Pressure
Rising MAG payments add pressure.
Revenue Estimates
FY25 revenue estimates are lower.
Outfront Media (OUT) vs. S&P 500 (SPY)
Market Cap
$2.74B
Dividend Yield5.58%
Average Volume (3M)1.83M
Price to Earnings (P/E)10.7
Beta (1Y)1.83
Revenue Growth0.57%
EPS GrowthN/A
CountryUS
Employees2,149
SectorReal Estate
Sector Strength62
IndustryREIT - Specialty
Share Statistics
EPS (TTM)1.48
Shares Outstanding167,024,610
10 Day Avg. Volume1,853,107
30 Day Avg. Volume1,826,671
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.48
Price to Cash Flow (P/CF)5.50
P/FCF Ratio6.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$20.25Price Target Upside23.55% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Outfront Media Business Overview & Revenue Model
Company DescriptionOutfront Media Inc. leverages the power of technology, location and creativity to connect brands with consumers outside of their homes through one of the largest and most diverse sets of billboard, transit, and mobile assets in North America. Through its technology platform, Outfront Media Inc. will fundamentally change the ways advertisers engage audiences on-the-go.
How the Company Makes MoneyOutfront Media generates revenue primarily through leasing advertising space on its extensive network of out-of-home assets, which include traditional billboards, digital displays, and transit advertising formats. The company's key revenue streams are derived from selling advertising space to local, regional, and national advertisers across various industries. Outfront Media's strategic partnerships with transit authorities and municipalities enable it to secure prime advertising locations, particularly in high-visibility areas such as major transportation hubs and city centers. Additionally, the company invests in digital technology to enhance its advertising offerings, allowing for dynamic and targeted advertising campaigns that command premium pricing, thereby contributing to its earnings.
Outfront Media Financial Statement Overview
Summary
Outfront Media demonstrates a recovery trajectory in financial performance with improvements in profitability and cash flow efficiency. The income statement shows stability, but high leverage on the balance sheet remains a concern. Cash flow is strong, supporting liquidity.Income Statement
Outfront Media's income statement shows an improving trend with a gross profit margin of 48.2% and a net profit margin of 14.1% for the latest year. The EBIT and EBITDA margins have rebounded to 23.2% after a previous negative year. Revenue growth rate is modest at 0.6%, indicating stability with some improvement over the previous year.69
Positive
Balance Sheet
The balance sheet reveals a challenging financial structure with a high debt-to-equity ratio of 2.36, indicating significant leverage. The return on equity stands at 39.8%, suggesting efficient use of equity, despite low equity ratio of 12.4%. The company has reduced its total debt, improving overall financial stability.55
Neutral
Cash Flow
Cash flow analysis shows strong operational cash flow at 115.9% of net income, with free cash flow growing by 32% year-on-year. The free cash flow to net income ratio is 85.6%, demonstrating efficient cash management and a positive outlook for liquidity.72
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.83B | 1.82B | 1.77B | 1.46B | 1.24B | Gross Profit |
| 881.90M | 852.30M | 860.70M | 679.90M | 525.50M | EBIT |
| 425.50M | -258.40M | 287.70M | 168.30M | 72.50M | EBITDA |
| 425.50M | -105.70M | 438.20M | 307.40M | 218.40M | Net Income Common Stockholders |
| 258.20M | -430.40M | 147.90M | 35.60M | -59.60M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 46.90M | 36.00M | 40.40M | 424.80M | 710.40M | Total Assets |
| 5.22B | 5.58B | 5.99B | 5.92B | 5.90B | Total Debt |
| 1.53B | 4.34B | 4.21B | 4.12B | 4.13B | Net Debt |
| 1.48B | 4.30B | 4.17B | 3.69B | 3.42B | Total Liabilities |
| 4.43B | 4.85B | 4.76B | 4.53B | 4.51B | Stockholders Equity |
| 649.00M | 726.80M | 1.23B | 1.38B | 1.36B |
| Cash Flow | Free Cash Flow | |||
| 221.10M | 167.40M | 157.50M | 8.50M | 53.50M | Operating Cash Flow |
| 299.20M | 254.20M | 254.10M | 98.80M | 130.60M | Investing Cash Flow |
| 207.50M | -107.50M | -449.50M | -224.00M | -53.20M | Financing Cash Flow |
| -495.40M | -151.50M | -188.00M | -162.20M | 573.00M |
Outfront Media Technical Analysis
Negative
16.39
Price Trends
17.70
Negative
17.98
Negative
16.80
Negative
Market Momentum
-0.41
Negative
41.54
Neutral
64.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OUT, the sentiment is Negative. The current price of 16.39 is below the 20-day moving average (MA) of 16.86, below the 50-day MA of 17.70, and below the 200-day MA of 16.80, indicating a bearish trend. The MACD of -0.41 indicates Negative momentum. The RSI at 41.54 is Neutral, neither overbought nor oversold. The STOCH value of 64.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OUT.
Outfront Media Risk Analysis
Outfront Media disclosed 40 risk factors in its most recent earnings report. Outfront 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
Outfront Media Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $15.94B | 10.78 | 37.92% | 3.45% | 6.79% | 7.79% | |
73 Outperform | $24.62B | 13.82 | 16.11% | 2.64% | 8.35% | 26.60% | |
70 Outperform | $9.87B | 14.40 | 17.82% | 4.98% | -1.81% | -35.74% | |
69 Neutral | $11.55B | 32.00 | 31.97% | 4.74% | 4.55% | -27.25% | |
65 Neutral | $2.74B | 10.67 | 34.53% | 5.58% | 0.57% | ― | |
61 Neutral | $4.73B | 18.32 | -3.52% | 11.32% | 5.97% | -21.87% | |
30 Underperform | $548.87M | ― | 4.92% | ― | -13.48% | 55.39% |
* Real Estate Sector Average
Performance Comparison
OUT
Outfront Media
16.39
1.11
7.26%
CCO
Clear Channel Outdoor
1.12
-0.49
-30.43%
IPG
Interpublic Group of Companies
26.40
-4.71
-15.14%
LAMR
Lamar Advertising
112.46
1.95
1.76%
OMC
Omnicom Group
80.24
-13.42
-14.33%
PUBGY
Publicis Groupe SA
24.35
-2.13
-8.04%
Outfront Media Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -8.84% | Next Earnings Date: May 2, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth in key areas such as organic revenues, digital sales, and AFFO. The reduction in leverage and growth in automated sales platforms further underscore positive developments. However, these were slightly offset by challenges in local ad growth and contract exits impacting growth. Overall, the positive highlights slightly outweigh the lowlights.Highlights
Organic Revenue Growth
Organic revenues grew approximately 4% year-over-year, excluding the Canadian business results. Billboard revenues were up 3%, and transit revenues increased nearly 9% for the year.
Automated Sales Platforms
Significant growth in automated sales platforms was observed, increasing from 14% of digital billboard revenues in 2023 to 20% in 2024.
AFFO Growth
2024 AFFO grew 11.5%, ahead of the high single-digit guidance provided the previous year.
Leverage Reduction
Leverage was reduced to 4.7 times from 5.4 times at the end of 2023, primarily by using proceeds from the sale of the Canadian business.
Digital Revenue Performance
Digital revenue grew almost 7% in the quarter, with digital revenue representing nearly 36% of total revenues, up from 34% the previous year.
Lowlights
Marginally Profitable Contract Exit
The exit of a marginally profitable contract in October impacted billboard growth by over 100 basis points.
Soft Local Ad Growth
Local ad growth was softer than expected, growing just under 1% during the quarter, due to strong prior year comps and macroeconomic uncertainty.
Transit Franchise Expenses
Transit franchise expenses increased slightly due to contractually obligated increases, and ongoing maintenance costs are expected to continue through the end of the contract in 2030.
Company Guidance
During OUTFRONT Media's fourth quarter 2024 earnings call, the company provided several key metrics and guidance for 2025. Organic revenues for the year increased by about 4% year-over-year, driven by a 3% rise in billboard revenues and a significant 9% growth in transit revenues, with the New York MTA leading with nearly 12% growth. Digital billboard revenues also saw substantial growth, with automated sales platforms accounting for 20% of digital billboard revenues, up from 14% in 2023. The company's adjusted operating income before depreciation and amortization (OIBDA) was $155 million for Q4, while adjusted funds from operations (AFFO) reached $119 million, contributing to a total of $308 million for 2024, surpassing the guidance provided earlier. For 2025, OUTFRONT Media expects mid-single-digit AFFO growth, driven by improvements in OIBDA. The company ended 2024 with a reduced leverage ratio of 4.7 times, down from 5.4 times in 2023, and announced a dividend of $0.30 per share. The guidance for the first quarter of 2025 expects slightly up revenues compared to last year, with flat billboard revenues and mid-single-digit growth in transit revenues.Outfront Media Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Outfront Media Appoints Nicolas Brien as Interim CEO
Positive
Feb 4, 2025
On January 31, 2025, OUTFRONT Media Inc. appointed Nicolas Brien as Interim CEO, effective February 10, 2025, following Jeremy Male’s retirement. Brien, with extensive experience in advertising and media industries, is expected to drive OUTFRONT Media’s next phase of strategic growth and innovation, leveraging his deep insights and industry expertise to enhance the company’s technological evolution and brand engagement.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.