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3 Hot Radio Stocks: Which Should You Buy?

Pandora, Sirius and Cumulus have put up market-crushing returns. We look at whether any are still worth the risk.

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Cumulus Media

Cumulus Media NASDAQ:CMLSTiny Cumulus Media is the biggest publicly traded radio stock — which isn’t saying much. With a market value of less than $800 million, you’d expect this stock to be volatile.

It is — the beta of 2.5 means it’s more than twice as bipolar as the broader market.

Still, Cumulus is up 65% during the past year, beating the S&P 500 by more than 50 percentage points. And hey, it is on track to return to profitability this year. Analysts forecast full-year earnings of 23 cents a share vs. a year-ago loss of 50 cents.

However, the stock-price appreciation might have gotten ahead of this turnaround story. The forward P/E of 11 sure looks cheap, and it’s in line with its own five-year average.

But with a long-term growth rate of -1%? Well, be forewarned that this stock could also be cheap for a reason.

As of this writing, Dan Burrows did not hold a position in any of the aforementioned securities. 

Article printed from InvestorPlace Media,

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