Townsquare Media (TSQ) AI Stock Analysis

• Market Cap: $113.32M
• Dividend Yield: 11.78%
• Average Volume (3M): 66.92K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.90
• Revenue Growth: -0.72%
• EPS Growth: 67.36%
• Country: US
• Employees: 2,049
• Sector: Communication Services
• Sector Strength: 81
• Industry: Advertising Agencies
• EPS (TTM): -1.15
• Shares Outstanding: 14,803,902
• 10 Day Avg. Volume: 61,126
• 30 Day Avg. Volume: 66,917
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 6.01
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.51
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $18.00
• Price Target Upside: 156.05% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

Townsquare Media's overall stock score reflects its financial struggles, with declining revenues and high leverage being significant concerns. While the technical analysis indicates bearish momentum, the company's strategic focus on digital growth and recent refinancing efforts offer some optimism. The high dividend yield presents a potential opportunity for investors, but sustainability remains uncertain. Overall, the stock presents a balanced risk-reward profile with notable challenges and strategic opportunities.

Positive Factors

Digital Revenue Growth

More than 50% of revenues and roughly 60% of profits in the quarter came from the company’s digital businesses.

Dividend Confidence

Management’s confidence in the trajectory of the business underlies the $0.79 annual dividend, which provides a 7.9% yield.

Negative Factors

Leverage Concerns

While leverage is elevated at 4.88x, management’s confidence in the trajectory of the business underlies the dividend.

Townsquare Media Business Overview & Revenue Model

Company Description

Townsquare 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 Money

Townsquare Media generates revenue through a combination of traditional advertising and digital marketing services. Its radio broadcasting segment earns money from selling advertising space to local and national clients. The company also monetizes its digital properties by providing digital marketing and advertising solutions through Townsquare Interactive, which includes services such as website design, search engine optimization, and social media management for local businesses. Live events contribute to the company's earnings by selling tickets, sponsorships, and merchandise. Partnerships with other media and technology companies also play a role in enhancing its content distribution and advertising capabilities.

Townsquare Media Financial Statement Overview

Summary

Townsquare Media faces significant financial challenges, highlighted by declining revenues, volatile profitability, and a heavily leveraged balance sheet. While operating cash flows remain relatively strong, the negative equity position and inconsistent free cash flow generation pose substantial risks. The company needs to address its debt levels and improve profitability to stabilize its financial position.

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.

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.

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.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
450.98M	454.23M	463.08M	417.96M	371.34M
	Gross Profit
450.98M	125.03M	138.15M	129.66M	88.99M
	EBIT
21.69M	-19.14M	88.83M	74.48M	40.73M
	EBITDA
41.36M	9.01M	72.70M	101.39M	-60.44M
	Net Income Common Stockholders
0.00	-44.96M	12.34M	16.74M	-80.55M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
32.99M	61.05M	43.42M	50.51M	83.23M
	Total Assets
580.41M	652.05M	744.52M	726.31M	768.50M
	Total Debt
53.20M	552.00M	578.56M	587.66M	595.80M
	Net Debt
20.21M	490.95M	535.14M	537.15M	512.57M
	Total Liabilities
608.86M	642.14M	675.44M	676.73M	667.75M
	Stockholders Equity
-28.44M	6.41M	65.52M	46.26M	97.26M
Cash Flow		Free Cash Flow
31.31M	52.85M	29.36M	48.72M	16.30M
	Operating Cash Flow
48.75M	67.83M	50.19M	61.14M	31.49M
	Investing Cash Flow
-9.93M	-3.57M	-37.76M	-10.64M	-14.04M
	Financing Cash Flow
-67.38M	-46.62M	-19.51M	-83.23M	-18.89M

Townsquare Media Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 7.03
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSQ, the sentiment is Neutral. The current price of 7.03 is above the 20-day moving average (MA) of 6.84, below the 50-day MA of 7.48, and below the 200-day MA of 9.01, indicating a neutral trend. The MACD of -0.23 indicates Negative momentum. The RSI at 49.05 is Neutral, neither overbought nor oversold. The STOCH value of 50.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSQ.

Townsquare Media Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SWAG	65 Neutral	$19.58M	―	-12.29%	―	8.76%	-969.71%
Sector *	59 Neutral	$13.76B	7.65	-2.18%	3.85%	2.32%	-36.56%
TSQ	50 Neutral	$113.32M	―	74.55%	11.78%	-0.72%	67.36%
HHS	47 Neutral	$36.85M	―	-145.85%	―	-3.26%	-1829.89%
ADV	45 Neutral	$446.25M	―	-40.41%	―	-15.17%	-567.89%
FLNT	42 Neutral	$45.42M	―	-98.64%	―	-14.67%	59.39%
MCHX	38 Underperform	$65.41M	―	-14.44%	―	-3.58%	50.73%

Townsquare Media Corporate Events

Townsquare Media Secures $490 Million Credit Agreement

On February 19, 2025, Townsquare Media, Inc. entered into a $490 million credit agreement with Bank of America, N.A., which includes a $470 million senior secured term loan facility and a $20 million revolving credit facility. The company used approximately $453 million of the net proceeds to redeem all outstanding 6.875% senior secured notes due 2026, thereby restructuring its debt and potentially improving its financial flexibility.