CIBC raises price target on Stingray Group

Following the company’s fourth quarter results, CIBC analyst Scott Fletcher has raised his price target on Stingray Group (Stingray Group Stock Quote, Chart, News, Analysts, Financials TSX:RAY.A).

On June 4, RAY.A. reported its Q4 and fiscal 2024 results. In the fourth quarter, the company posted Adjusted EBITDA of 29.4-million on revenue of $83.7-million, a topline that was up 6.0% over the same period last year.

“We took giant strides to establish ourselves as a leader in retail media advertising, FAST channels and in-car audio entertainment during the past fiscal year, leading to robust adjusted [earnings before interest, taxes, depreciation and amortization] of $125.9-million on revenues of $345.4-million,” CEO Eric Boyko said. “In the process, we expanded our share in these new segments through operational excellence. Stingray Advertising revenues, which include retail media advertising and FAST channels, grew 45.4 per cent year over year against our annual growth target of 40 per cent. For its part, in-car audio entertainment surged 60.3 per cent during the same period. The trickle-down effect of these high-growth, high-margin businesses on profitability helped Stingray achieve a consolidated adjusted EBITDA margin of 36.4 per cent in 2024 versus the stated goal of 35 per cent. Consequently, we outperformed internal expectations during the past year with most key performance indicators pointing upwards of our objectives.”

As reported in the Globe and Mail, CIBC analyst Scott Fletcher June 6 maintained an “Outperformer” rating on Stingray, but raised his price target on the stock from $10.00 to $10.50. Shares of the company closed June 5 at $7.80.