Peter HodsonStingray Group (Stingray Group Stock Quote, Chart, News TSX:RAY.A) has been in the literal and figurative background for too long, says Peter Hodson of 5i Research. While perhaps known for its wallpaper music services in stores and on the TV, Hodson says that the serial acquirer in the Canadian media landscape consistently shows strong fundamentals, and with the recent pickup of radio company Newfoundland Capital, Stingray could be poised for a bounce-back year in 2020. Known for its Music on TV service which has a surprisingly huge audience \u2014 try 15 million Canadians over a given two-week period \u2014 Montreal-based Stingray made headlines last year with a $506-million purchase of Newfoundland Capital (NCC), one of the country\u2019s biggest private radio broadcasters with 101 radio licenses across Canada. The deal was just one of a string of acquisitions by Stingray in recent years, as the company looks to consolidate in the media sector. But the major purchase has set Stingray back and made the stock look a little less attractive, at least until they pay off some of that debt, says Hodson, founder and head of research at independent research firm 5i Research, who spoke to BNN Bloomberg on Thursday. \u201cIt\u2019s a bit of an misunderstood company \u2014it\u2019s a music and radio operator now. It generates pretty good cash flow but debt is very high,\u201d says Hodson. \u201cBut their dividend record is pretty good. You can barely go a quarter without them increasing their dividend. So they need to pay down that debt and I think they kind of need to do a little investor relations because people see it as background music in a retail environment,\u201d he says. \u201cWhat they hear, retail environment, they say, \u2018Well nobody wants that. Why don\u2019t they just put on Spotify or Apple Music? Why is this company even around?\u2019 But they have substantial revenues and there are all sorts of rights and regulations about music and about where you can and can\u2019t play it,\u201d says Hodson. Stingray has performed poorly over the past couple of years, dropping 30 per cent over 2018 and coming out of 2019 flat. But the company\u2019s finances look pretty good. Ahead of its fiscal third quarter financials due in the first week of February, Stingray\u2019s Q2 featured a 121-per-cent increase in revenue to $76.6 million, thanks to the NCC deal, while adjusted EBITDA climbed 142 per cent to $27.7 million and EBITDA margin went from 32.9 per cent to 36.1 per cent. \u201cWe are pleased with our second quarter results which continued to build on the significant momentum created by the acquisition of NCC, coupled with the solid growth from the Broadcasting and Commercial Music segment,\u201d said Eric Boyko, president and CEO, in a quarterly press release in November. \u201cA key measure of our achievement continues to be our Adjusted free cash flow which more than tripled to $18.8 million. For the first six months of the year, we have generated $0.52 of Adjusted free cash flow per share compared to $0.21 a year ago,\u201d he said.