Stingray Dgt Vary SV (RAY.B) AI Stock Analysis

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Stingray Dgt Vary SV

(TSX:RAY.B)

Rating:73Outperform

Price Target:

C$11.00

▲(10.00%Upside)

The stock's overall strong financial performance and positive earnings call results are the primary drivers of the score. Despite the leveraged balance sheet, the company's effective cash flow management and strategic growth initiatives bolster its outlook. Technical indicators show strong momentum, though caution is advised due to overbought signals.

Stingray Dgt Vary SV (RAY.B) vs. iShares MSCI Canada ETF (EWC)

Market Cap

C$675.22M

Dividend Yield4.12%

Average Volume (3M)489.00

Price to Earnings (P/E)18.7

Beta (1Y)0.33

Revenue Growth12.00%

EPS GrowthN/A

CountryCA

Employees1,000

SectorCommunication Services

Sector Strength93

IndustryBroadcasting

Share Statistics

EPS (TTM)0.11

Shares Outstanding2,283,437

10 Day Avg. Volume244

30 Day Avg. Volume489

Financial Highlights & Ratios

PEG Ratio-1.61

Price to Book (P/B)1.45

Price to Sales (P/S)0.00

P/FCF Ratio5.79

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Stingray Dgt Vary SV Business Overview & Revenue Model

Company DescriptionStingray Digital Group Inc. (RAY.B) is a leading music, media, and technology company based in Canada. It operates in the entertainment and broadcasting sectors, specializing in music and video services. The company offers a diverse range of products and services, including music streaming, in-store media solutions, digital signage, and karaoke services, catering to both consumer and business markets globally.

How the Company Makes MoneyStingray Digital Group Inc. generates revenue through multiple channels. The primary sources include subscription fees from its music streaming services, which cater to both individual consumers and businesses. The company also earns from licensing and advertising within its media content offerings. Additionally, Stingray provides in-store media solutions and digital signage services to businesses, creating another significant revenue stream. Partnerships with cable and satellite providers further enhance its distribution reach and contribute to its earnings. These various revenue streams are supported by Stingray's extensive music library and technology platforms, allowing it to offer tailored solutions to diverse market segments.

Stingray Dgt Vary SV Earnings Call Summary

Earnings Call Date:Jun 10, 2025

(Q4-2025)

% Change Since: 26.26%|

Next Earnings Date:Aug 12, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong growth in advertising revenue, successful new channel launches, and significant improvements in revenue and net income, indicating strong operational performance. However, there were challenges in sustaining subscription revenue growth and declines in certain regional revenues.

Q4-2025 Updates

Positive Updates

Strong Advertising Revenue Growth

Advertising revenue in broadcast and commercial music grew over 45% for the second consecutive year, driven by FAST channels and retail media.

Launch of New Channels

Introduction of new channels like Cozy Cafe and Stargaze, strengthening leadership in connected TV music and ambient content.

Organic Growth

Organic growth reached 12.3%, maintaining a trend of double-digit growth from the previous year's 10.2%.

Debt Reduction

Net debt reduced by $27 million with leverage ending at 2.28x, well within the company’s target.

Revenue and Earnings Improvement

Q4 revenue increased by 14.8% to $96 million, and net income was $7.7 million, a significant improvement from last year's $46.3 million loss.

FAST Revenue Momentum

FAST revenue is tracking well above initial expectations, with over 40% growth in Q1 2026.

Shareholder Returns

275,000 shares repurchased in Q4, totaling $9.1 million for the year, and $20.5 million paid in dividends.

Negative Updates

Decline in Other Regions' Revenue

Revenue from other regions decreased by 5.5% to $11.2 million.

Slight Decline in Cash Flow from Operations

Cash flow from operations dropped slightly due to higher taxes and restructuring costs.

Subscription Revenue Bump Not Sustainable

The 7% growth in subscription revenue in Q4 was a one-time promotion and not sustainable.

Company Guidance

In the recent Stingray Group Inc. Q4 2025 results conference call, significant growth metrics were highlighted, demonstrating the company's robust performance and strategic advancements. Advertising revenue in broadcast and commercial music surged over 45% for the second consecutive year, fueled by innovations like FAST channels and retail media, while organic growth reached 12.3%, marking two years of double-digit expansion. Financially, the company reduced net debt by $27 million, bringing leverage to 2.28x, and achieved a 19% increase in adjusted EBITDA to $35 million, with margins expanding to 36.5%. Broadcasting and commercial music revenue rose 17.8% to $254 million, and radio revenue grew 2.3% to $132 million. Additionally, Q4 revenue increased by 14.8% year-over-year to $96 million, driven by a 20.9% rise in broadcasting and commercial music revenue and a 3.9% increase in radio revenue. Net income improved significantly to $7.7 million from a $46.3 million loss last year. Looking ahead, the company aims to reinvest in high-growth areas, reduce leverage below 2x, and explore strategic M&A opportunities, while maintaining a focus on rewarding shareholders through buybacks and dividends.

Stingray Dgt Vary SV Financial Statement Overview

Summary

Stingray Dgt Vary SV exhibits revenue growth and strong gross profit margins but faces profitability challenges with negative net income in recent periods. High leverage presents financial risk, though cash flow generation remains robust. Strategic focus on improving operating efficiency and reducing debt could enhance financial stability and performance.

Income Statement

Neutral

The company has shown revenue growth with a TTM revenue increase from the previous year, but profitability metrics like the EBIT margin and net profit margin are concerning. The net profit margin is negative in the latest TTM data, reflecting a net loss. The gross profit margin is strong, indicating effective cost management at the production level, but operational expenses are likely impacting overall profitability.

Balance Sheet

Positive

The debt-to-equity ratio remains relatively high, signaling significant leverage which could pose risks if not managed carefully. However, the equity ratio is reasonable, indicating a stable asset base supported by equity. The return on equity is negative in the latest TTM, reflecting the profitability challenges, which impact shareholder returns.

Cash Flow

Positive

The company demonstrates strong operating cash flow relative to net income, suggesting good cash-generating ability despite net losses. Free cash flow is positive and has grown, highlighting effective capital expenditure control. However, sustainability of this positive cash flow in light of ongoing net losses is a potential concern.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	374.55M	345.43M	323.94M	282.63M	249.47M	306.72M
Gross Profit	111.65M	87.95M	111.67M	87.23M	83.43M	116.34M
EBITDA	55.78M	60.78M	94.66M	91.59M	116.74M	72.81M
Net Income	-17.53M	-13.74M	30.12M	33.29M	45.10M	13.97M
Balance Sheet
Total Assets	836.57M	811.57M	895.20M	883.70M	822.84M	867.99M
Cash, Cash Equivalents and Short-Term Investments	19.25M	9.61M	15.45M	14.56M	9.04M	2.51M
Total Debt	390.13M	386.70M	412.24M	411.96M	365.66M	394.62M
Total Liabilities	570.51M	562.98M	608.93M	610.17M	548.14M	594.10M
Stockholders Equity	266.06M	248.58M	286.27M	273.53M	274.69M	273.90M
Cash Flow
Free Cash Flow	90.40M	104.48M	71.49M	66.61M	90.81M	73.77M
Operating Cash Flow	103.23M	118.53M	86.95M	83.66M	104.25M	88.14M
Investing Cash Flow	-18.02M	-16.64M	-20.61M	-18.63M	5.43M	-17.95M
Financing Cash Flow	-73.20M	-107.72M	-65.45M	-59.51M	-103.15M	-72.36M

Stingray Dgt Vary SV Technical Analysis

Technical Analysis Sentiment

Positive

Last Price10.00

Price Trends

50DMA

8.32

Positive

100DMA

8.41

Positive

200DMA

7.84

Positive

Market Momentum

MACD

0.47

Negative

RSI

68.86

Neutral

STOCH

73.58

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RAY.B, the sentiment is Positive. The current price of 10 is above the 20-day moving average (MA) of 9.14, above the 50-day MA of 8.32, and above the 200-day MA of 7.84, indicating a bullish trend. The MACD of 0.47 indicates Negative momentum. The RSI at 68.86 is Neutral, neither overbought nor oversold. The STOCH value of 73.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RAY.B.

Stingray Dgt Vary SV Peers Comparison

Overall Rating

UnderperformOutperform

Sector (58)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RAY.A	74 Outperform	C$675.22M	18.63	14.14%	4.14%	12.00%	―
CGO	74 Outperform	C$625.33M	7.16	10.38%	7.83%	0.06%	115.11%
RAY.B	73 Outperform	C$675.22M	18.74	14.14%	4.12%	12.00%	―
Sector *	58 Neutral	C$3.18B	5.94	-0.75%	6.71%	-2.19%	-11.60%
WILD	56 Neutral	$443.74M	―	-3581.90%	―	8.40%	-137.80%
TVA.B	54 Neutral	C$32.40M	―	-6.62%	―	-2.38%	59.61%
CJR.B	45 Neutral	$19.94M	―	175.81%	―	-13.09%	88.95%

* Communication Services Sector Average

Performance Comparison

TSE:RAY.B

Stingray Dgt Vary SV

10.00

2.30

29.87%

TSE:WILD

WildBrain

2.09

0.96

84.96%

TSE:CJR.B

Corus Entertainment

0.10

-0.07

-42.86%

TSE:RAY.A

Stingray Digit SV

9.94

2.79

39.02%

TSE:CGO

Cogeco Inc. SV

64.85

19.23

42.15%

TSE:TVA.B

TVA Group Inc B NV

0.75

-0.44

-36.97%

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.Date of analysis: Jun 18, 2025