Comparing Salem Media Group (SALM) & Cumulus Media (CMLS)

Salem Media Group (NASDAQ: SALM) and Cumulus Media (NASDAQ:CMLS) are both small-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, profitabiliy, institutional ownership, valuation, earnings, analyst recommendations and dividends.

Profitability

This table compares Salem Media Group and Cumulus Media’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Salem Media Group 3.49% 6.42% 2.32%
Cumulus Media -44.30% -216.43% -0.45%

Analyst Ratings

This is a summary of current recommendations for Salem Media Group and Cumulus Media, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Salem Media Group 0 0 0 0 N/A
Cumulus Media 0 1 0 0 2.00

Valuation and Earnings

This table compares Salem Media Group and Cumulus Media’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Salem Media Group $274.73 million 0.68 $46.50 million $0.36 20.00
Cumulus Media $1.14 billion 0.01 $202.03 million ($17.24) -0.03

Cumulus Media has higher revenue and earnings than Salem Media Group. Cumulus Media is trading at a lower price-to-earnings ratio than Salem Media Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Salem Media Group pays an annual dividend of $0.26 per share and has a dividend yield of 3.6%. Cumulus Media does not pay a dividend. Salem Media Group pays out 72.2% of its earnings in the form of a dividend.

Risk and Volatility

Salem Media Group has a beta of 1.22, suggesting that its stock price is 22% more volatile than the S&P 500. Comparatively, Cumulus Media has a beta of 3.54, suggesting that its stock price is 254% more volatile than the S&P 500.

Institutional & Insider Ownership

29.7% of Salem Media Group shares are owned by institutional investors. Comparatively, 67.0% of Cumulus Media shares are owned by institutional investors. 60.0% of Salem Media Group shares are owned by insiders. Comparatively, 13.5% of Cumulus Media shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Salem Media Group beats Cumulus Media on 7 of the 12 factors compared between the two stocks.

Salem Media Group Company Profile

Salem Media Group, Inc., formerly Salem Communications Corporation, is a multi-media company specializing in Christian and Conservative content, with media properties consisting of radio broadcasting, digital media, and book, magazine and newsletter publishing. The Company operates through three segments: Broadcast, Digital Media and Publishing. The Company’s broadcasting segment is engaged in the ownership and operation of radio stations in metropolitan markets. The Company’s radio stations carry national and local programming content, as well as national and local advertisers. The Company’s Digital Media segment focuses on Web-based platform designed for audiences interested in Christian and family-themed content and conservative news. The Company’s publishing segment consists of Regnery Publishing, Xulon Press and Salem Publishing. The Company owns and operates approximately 116 radio stations in over 40 markets.

Cumulus Media Company Profile

Cumulus Media Inc. (Cumulus) is a radio broadcasting company. The Company is also a provider of country music and lifestyle content through its NASH brand, which serves through radio programming, NASH Country Weekly magazine and live events. Its product lines include broadcast advertising, digital advertising, political advertising and non-advertising based license fees. Its broadcast advertising includes the sale of commercial advertising time to local, national and network clients. Its digital advertising includes the sale of advertising and promotional opportunities across its Websites and mobile applications. Its across the nation platform generates content distributable through both broadcast and digital platforms. Its categories of advertisers consist of amusement and recreation; banking and mortgage; furniture and home furnishings; arts and entertainment; food and beverage services; healthcare services; automotive dealers; food and beverage stores, and telecommunications.

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