Stingray Group (RAY) AI Stock Analysis

• Market Cap: C$1.02B
• Dividend Yield: 2.19%
• Average Volume (3M): 34.56K
• Price to Earnings (P/E): 32.8
• Beta (1Y): 0.53
• Revenue Growth: 12.69%
• EPS Growth: N/A
• Country: CA
• Employees: 1,000
• Sector: Communication Services
• Sector Strength: 97
• Industry: Broadcasting
• EPS (TTM): 0.38
• Shares Outstanding: 55,063,840
• 10 Day Avg. Volume: 24,316
• 30 Day Avg. Volume: 34,557
• PEG Ratio: -0.05
• Price to Book (P/B): 2.30
• Price to Sales (P/S): 1.58
• P/FCF Ratio: 6.81
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$20.50
• Price Target Upside: 46.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 1.38
• Revenue Forecast (FY): C$476.17M

• Rating: 74 Outperform
• Price Target: C$15.50 ▲(10.71% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by strong free cash flow and solid profitability, supported by a constructive technical uptrend. Offsetting factors are meaningful leverage and earnings variability, plus a relatively high P/E with only a modest dividend yield; earnings-call commentary was broadly positive but noted margin pressure and acquisition-driven debt.

Positive Factors

Free Cash Flow Strength

Consistent, improving free cash flow is a durable strength: with FCF at $102.6M and strong operating cash conversion, Stingray can fund organic growth, integration costs, buybacks and deleveraging without relying on equity issuance. High cash generation cushions cyclicality in advertising and supports strategic optionality.

Programmatic Ads & TuneIn Synergies

Rapid programmatic ad ramp and early TuneIn synergies create a structural, higher-margin monetization channel. Management’s $20–40M cross-sell and $10–15M cost-savings targets imply scalable revenue upside and durable margin improvement as integrations mature and ad inventory is monetized across larger U.S. audiences.

Distribution Expansion & U.S. Growth

Meaningful U.S. growth and OEM pre-install partnerships broaden distribution and lock in recurring access to listeners. In-car and large-platform integrations expand addressable market and create sticky, long-duration channels that can sustainably lift subscription, ad and equipment revenue as vehicle rollouts scale over multiple model years.

Negative Factors

Elevated Leverage

Acquisition-fueled debt materially increases financial risk: leverage near 2.5x reduces balance-sheet flexibility, raises interest and covenant sensitivity, and constrains capital allocation until deleveraging is achieved. A failure to reach sub-2.0x targets would limit M&A optionality and pressure credit metrics through cycles.

Margin Compression from M&A and Mix Shift

Lower-margin contributions from recent acquisitions and a shift to programmatic/backfill inventory have compressed consolidated margins. If the mix change persists or synergies lag, structural margin pressures could reduce long-term free cash flow and impair the company's ability to re-invest or accelerate deleveraging.

Earnings Volatility & Integration Costs

Significant one-time and integration-related expenses have driven volatile GAAP results. Persistent integration, legal or restructuring outlays and softer subscription trends (noted in TuneIn) create uncertain near-term earnings visibility, complicating planning and potentially delaying the realization of projected cost and revenue synergies.

Stingray Group Business Overview & Revenue Model

Company Description

Stingray Group Inc. operates as a music, media, and technology company in Canada, the United States, and internationally. It operates through Broadcasting and Commercial Music and Radio segments. The company offers music, digital, and advertising services to enterprise brands, including audio and video channels, radio stations, subscription video-on-demand content, free and ad-supported TV (FAST) channels, karaoke products and music apps, and in-car and on-board infotainment content. It also provides commercial solutions in music, in-store advertising solutions, digital signage, and AI-driven consumer insights and feedback, as well as delivers digital audio messaging and audio advertising. In addition, the company offers subscription video on demand, such as Qello Concerts by Stingray, Stingray Classica, Stingray DJAZZ, Stingray Karaoke, Stingray Naturescape, ZenLIFE by Stingray, and The Coda Collection. It also offers FAST channels, including Stingray Music, Qello Concerts by Stingray, Stingray Classica, Stingray DJAZZ, Stingray CMusic, Stingray Karaoke, Stingray Naturescape, Stingray Holidayscapes, ZenLIFE by Stingray, Ultimate Trivia by Stingray, Stingray Cozy Café, Stingray Stargaze, Stingray Cityscapes, Movie Music by Stingray, Loupe Art, and EarthDay 365. The company distributes its products and services through various platforms, including digital cable TV, satellite TV, IPTV, OTT, the internet, mobile devices, game consoles, and connected cars. It serves cable and telecom companies, retailers, and small and medium businesses, as well as direct consumers. The company was formerly known as Stingray Digital Group Inc. and changed its name to Stingray Group Inc. in December 2018. Stingray Group Inc. was founded in 2007 and is headquartered in Montreal, Canada.

How the Company Makes Money

Stingray generates revenue primarily by monetizing music and digital media content across multiple distribution channels and customer types. A key revenue stream comes from recurring fees paid by television service providers (e.g., cable, satellite, and IPTV operators) that carry Stingray’s music and video channels; these arrangements typically resemble wholesale/affiliate distribution revenue where the operator pays to include Stingray channels in its channel packages. The company also earns revenue from business-to-business subscriptions by providing curated music and in-store audio solutions to commercial locations (e.g., retail, restaurants, hospitality), generally on a recurring monthly fee basis. Stingray further monetizes its digital media footprint through advertising—selling ad inventory and running campaigns across its digital properties and/or partner distribution environments—and may also generate consumer revenue from subscriptions or purchases tied to its direct-to-consumer apps and streaming products. Additional earnings can come from content licensing and other service arrangements related to music and media distribution. null

Stingray Group Financial Statement Overview

Summary

Strong cash generation and improving free cash flow (TTM FCF $102.6M, +30.7% y/y; FCF/NI ~0.86) support a solid operating profile. Profitability is healthy (TTM net margin 12.6%; EBIT/EBITDA margins 21.3%/28.8%), but leverage is a key risk (TTM debt-to-equity 1.24x) and earnings have been volatile (loss in 2024, then recovery).

Income Statement

TTM (Trailing-Twelve-Months) revenue grew 4.0%, continuing a generally positive multi-year top-line trend despite a decline in 2021. Profitability looks solid in the latest period, with net margin at 12.6% and EBIT/EBITDA margins at 21.3%/28.8%. A key watch-out is earnings volatility: net income swung to a loss in 2024 before recovering in 2025 and TTM, suggesting results can be uneven year-to-year.

Balance Sheet

Leverage is meaningful: TTM debt-to-equity is 1.24x (and has been higher historically), which reduces flexibility if operating conditions weaken. That said, profitability on equity is strong in the latest period (TTM return on equity ~18.9%), and equity has grown versus 2024, supporting the capital structure. Overall, the balance sheet is workable, but debt remains a notable risk factor for a mid-growth business.

Cash Flow

Cash generation is a clear strength. TTM operating cash flow is $116.2M and free cash flow is $102.6M, with free cash flow up 30.7% versus the prior period. Free cash flow is also high relative to earnings (TTM free cash flow to net income ~0.86), indicating profits are translating well into cash. The main drawback is that cash flow relative to accounting earnings is not consistently above 1.0 (TTM operating cash flow to net income ~0.93), though it remains healthy overall.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	429.75M	386.89M	345.43M	323.94M	282.63M	247.86M
Gross Profit	354.88M	100.83M	87.95M	89.66M	68.82M	76.64M
EBITDA	110.34M	102.08M	60.28M	111.67M	92.67M	106.98M
Net Income	43.70M	36.44M	-13.74M	30.12M	33.29M	45.10M
Balance Sheet
Total Assets	1.15B	816.66M	811.57M	895.20M	883.70M	822.84M
Cash, Cash Equivalents and Short-Term Investments	17.33M	13.98M	9.61M	15.45M	14.56M	9.04M
Total Debt	543.62M	360.16M	386.70M	412.24M	409.35M	365.66M
Total Liabilities	866.47M	549.82M	562.98M	608.93M	610.17M	548.14M
Stockholders Equity	285.17M	266.83M	248.58M	286.27M	273.53M	274.69M
Cash Flow
Free Cash Flow	102.63M	89.98M	104.48M	71.49M	66.61M	90.81M
Operating Cash Flow	116.16M	105.04M	118.53M	86.95M	83.66M	104.25M
Investing Cash Flow	-216.10M	-17.40M	-16.64M	-20.61M	-18.63M	5.43M
Financing Cash Flow	98.30M	-83.36M	-107.72M	-65.45M	-59.51M	-103.15M

Stingray Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RAY, the sentiment is Positive. The current price of 14 is below the 20-day moving average (MA) of 14.95, below the 50-day MA of 15.47, and above the 200-day MA of 12.29, indicating a neutral trend. The MACD of -0.38 indicates Positive momentum. The RSI at 50.34 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RAY.

Stingray Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RAY	74 Outperform	C$1.02B	32.77	19.09%	2.19%	12.69%	―
CGO	62 Neutral	C$733.91M	5.38	10.16%	5.98%	-2.14%	4.40%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
CGX	47 Neutral	C$642.00M	-17.97	―	―	18.50%	31.15%
BAMI	46 Neutral	C$587.72M	-0.08	-72.77%	―	-59.51%	-545.36%
WILD	43 Neutral	C$254.25M	-224.02	―	―	16.65%	1.41%
CJR.B	41 Neutral	C$5.98M	-0.16	―	―	-11.27%	57.50%