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Steven Cohen Makes Two Large Buys into Media Companies

August 13, 2013 | About:
Monica Wolfe

Monica Wolfe

127 followers
On Aug. 9, the struggling guru [/size]Steven Cohen made to sizeable buys. The guru upped his position in Sinclair Broadcast Group and bought into LIN Media. These buys are particularly interesting seeing as Cohen has recently been under fire from the media as he fights off allegations of illegal insider trading for both himself and his fund, SAC Capital Advisors.

Sinclair Broadcast Group (SBGI)

On Aug. 9, Cohen increased his position in Sinclair Broadcast Group by a significant 159.17%. The guru purchased a total of 2,364,952 shares at an average price of $25.50 per share. Since his buy, the price per share is down about -3%.

Cohen now holds on to a total of 3,850,741 shares of Sinclair Broadcasting, representing 4.72% of the company’s shares outstanding.

Cohen’s holding history of Sinclair Broadcast Group as of the first quarter:

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Sinclair Broadcast Group is one of the largest and most diversified television broadcasting companies in the U.S. The company owns and operates programs or provides sales services to 149 television stations in 76 markets. Sinclair’s television group reaches approximately 38% of U.S. television households and includes FOX, ABC, MyTV, CW, CBS, NBC, Univision and Azteca affiliates.

Sinclair’s historical revenue and net income:

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The company’s second quarter earnings reported:

· Net broadcast revenues from continuing operations were $279.3 million, an increase of 28.4%.

· Net income of $17.8 million, which includes a $16.3 million one-time loss from extinguishment of loss.

· Diluted EPS of $0.19.

· The company also declared a $0.15 quarterly dividend per share.

The company also recently released that it had closed on their acquisition of Fisher Communications.

The Peter Lynch Chart shows that SBGI is currently slightly overvalued:

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The analysis on the company notes that the price of Sinclair is inching back towards its 10-year high of $31.24, that its dividend yield is close to a two-year low and that its P/S ratio is near a 10-year high.

Sinclair Broadcast Group has a market cap of $2.51 billion. Its shares are currently trading at around $24.84 with a P/E ratio of 15.40 and a P/S ratio of 1.80. The company’s dividend yield is currently sitting at 2.40%.

LIN Media (LIN)

On Aug. 9 Cohen also made a rather large buy into LIN Media. The guru purchased a total of 1,701,054 shares at an average price of $15.10 per share. Since his buy, the price per share is trading down 1%.

Cohen’s new buy gives him a 3.14% stake in the company. Cohen previously held shares of the company, but he sold out in first quarter 2013.

A look at Cohen’s previous holding history of LIN Media:

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LIN Media is a local multimedia company that operates or services 43 TV stations and seven digital in 23 U.S. markets, along with a diverse portfolio of websites, apps and mobile products that make it more convenient to access its unique and relevant content on multiple screens.

LIN Media’s historical revenue and net income:

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The company’s second quarter results reported:

· Net revenues of $164.3 million, a 36% increase.

· Operating income decreased 23% to $26.9 million.

· Net income per diluted share was $0.13, compared to $0.48 in Q2 2012.

· Net cash of $925.1 million.

The company also recently announced the completion of their merger with LIN TV Corp. This closing successfully concludes the company’s plans to resolve the NBC JV guarantee and tax overhangs that have in recent years limited its strategic options.

The analysis on LIN reports that the company’s asset growth is faster than its revenue growth and that its price and P/S ratio are nearing 5-year highs of $17.75 and 1.6, respectively.

LIN Media has a market cap of $856.1 million. Its shares are currently trading at around $15.05 with a P/E ratio of 6.90 and a P/S ratio of 1.40.

Check out Steven Cohen’s Real Time Picks here.

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