Urban One, Recent Acquisition Agreement, Analysts Target

Urban One, Inc. (NASDAQ: UONE) together with its subsidiaries, operates as an urban-oriented multi-media company in the United States. The company operates through four segments: Radio Broadcasting, Reach Media, Digital, and Cable Television.


On May 30, 2018 UONE shares opened at $1.95 and soared to an intra-day high of $4.20 per share. Traded volume was 819 thousand shares versus a daily average of 13 thousand shares. In early trading on Thursday, May 31, 2018 UONE shares were up 20% on the day.


Early in May the company reported its Q1 results. Alfred C. Liggins, III, Urban One’s CEO and President stated, “Our cash generation for the quarter was strong; we added approximately $6.3 million of cash to the balance sheet while repurchasing $11.0 million of our 9.25% 2020 Notes, which re-affirms our commitment to reducing the Company’s leverage. Finally, we recently entered into a binding agreement to sell WPZR in Detroit for $12.7 million, which represents a high double-digit seller’s multiple and will further help to reduce our net leverage.”


Recent Events

May 21, 2018. Urban One, Red Zebra Broadcasting and the Washington Redskins announced today that Urban One has signed a definitive agreement to acquire the assets of the radio station The Team 980 (WTEM 980 AM) from Red Zebra Broadcasting, pending FCC approval. In addition, Urban One has also entered into an agreement with the Washington Redskins to ensure that all Redskins games, as well as pregame and postgame programming, will remain on The Team 980. The acquisition is the first step in a collaborative effort between the Redskins and Urban One to keep The Team 980 as the fans’ premier source for radio coverage of the Washington Redskins. https://backend.otcmarkets.com/otcapi/company/sec-filings/12770803/content/html#EXHIBIT99-1MAY212018_HTM


May 2, 2018. Urban One reported its results for the quarter ended March 31, 2018.  Net revenue was approximately $99.6 million, a decrease of 1.6% from the same period in 2017. Broadcast and digital operating income1 was approximately $32.5 million, a decrease of 7.0% from the same period in 2017. https://finance.yahoo.com/news/urban-one-inc-reports-first-104500647.html


May 1, 2018. Urban One announced it has signed a definitive agreement to sell the assets of one of its Detroit, Michigan, radio stations, WPZR-FM (102.7 FM), to Educational Media Foundation, of California, for total consideration of $12.7 million. https://finance.yahoo.com/news/urban-one-inc-announces-definitive-203000230.html



Urban One, Inc., together with its subsidiaries, operates as an urban-oriented multi-media company in the United States. The company operates through four segments: Radio Broadcasting, Reach Media, Digital, and Cable Television. The Radio Broadcasting segment includes radio broadcasting operations that primarily target African-American and urban listeners. As of December 31, 2017, it owned and/or operated 56 broadcast stations located in 15 urban markets. The Reach Media segment operates operate radio stations, including the Tom Joyner Morning Show; and other syndicated programming assets, including the Rickey Smiley Morning Show, the Russ Parr Morning Show, and the DL Hughley Show, as well as Get Up! Mornings with Erica Campbell. This segment also operates BlackAmericaWeb.com, an African-American targeted news and entertainment website; and operates other event related activities. The Digital segment is involved in online business, including the operation of Interactive One, an online platform serving the African-American community through social content, news, information, and entertainment Websites, including Cassius, Bossip, HipHopWired, and MadameNoire digital platforms and brands. The Cable Television segment operates TV One, an African-American targeted cable television network. The company was formerly known as Radio One, Inc. and changed its name to Urban One, Inc. in May 2017. Urban One, Inc. was founded in 1980 and is based in Silver Spring, Maryland.


Financial review

Q1 2018

Net revenue was approximately $99.6 million, a decrease of 1.6% from the same period in 2017. Broadcast and digital operating income1 was approximately $32.5 million, a decrease of 7.0% from the same period in 2017. The Company reported operating income of approximately $7.3 million for the three months ended March 31, 2018, compared to $16.5 million for the same period in 2017. Net loss was approximately $22.6 million or $0.48 per share (basic) compared to net loss of approximately $2.3 million or $0.05 per share (basic) for the same period in 2017. Adjusted EBITDA2 was approximately $28.5 million for the three months ended March 31, 2018, compared to $27.7 million for the same period in 2017, an increase of 2.7%.




The 1 analysts offering 12-month price forecasts for Urban One Inc have a median target of 6.00, with a high estimate of 6.00 and a low estimate of 6.00. The median estimate represents a +53.85% increase from the last price of 3.90.


Stock influences and risk factors

Continued growth through acquisition could act as a catalyst for UONE shares;

Two common stockholders have a majority voting interest in Urban One and have the power to control matters on which the common stockholders may vote, and their interests may conflict with UONE.

UONE success is dependent upon audience acceptance of content, particularly television and radio programs, which is difficult to predict;

The loss of key personnel, including certain on-air talent, could disrupt the management and operations of the business;

Unrelated third parties may claim that they infringe on their rights based on the nature and content of information posted on websites they maintain.


Stock chart

On Thursday, May 31, 2018, UONE shares were at $3.80 on traded volume of 482K shares. The current RSI (14) is 91.06

At $3.80 per share UONE shares are trading above their 50 DMA and 200 DMA of $1.95 and $1.79 respectively.


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