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Media Ecosystem Review Examines Financial & Valuation Trends in Six Sectors Competing for Local Advertising

Author: Lauren Ross, Vice President, Media Valuations

Over the past five years, financial and valuation trends in the media ecosystem have been a rollercoaster ride for anyone involved and watching. The pandemic contributed to changing consumer content consumption patterns, which has had profound impacts on the profitability of broadcast and audio companies. 

To provide an in-depth analysis, I have authored with our CEO, Tom Buono, a Media Ecosystem Review that focuses on 36 public companies in six sectors that compete for local advertising, including Digital, Large Diversified Video Providers, Television Groups, Audio Providers, Out-of-Home (OOH), and News & Information Companies. 

In our analysis, we look at revenue, profitability, valuation trends, and valuation multiples from pre-pandemic 2019 through the pandemic and year-end 2023. We believe it’s important to show a five-year lookback period to provide insights into sector performance during and after the pandemic and to see what companies in the media ecosystem are the current winners and losers.

We also include important local media advertising trends from our U.S. Local Advertising Forecast and BIA’s new Share of Wallet (SoW) analysis to track competitive spend within each of the six sectors. 

Here are three key takeaways to give you a preview of the report:

  1. Total local advertising in the U.S. declined by an estimated 6.9% in 2020 (to $138.2 billion), followed by two years of high-single-digit to low-double-digit growth, reaching $163.8 billion in 2022, and a 3.9% decline to $157.4 billion in 2023.
  2. Digital Media Companies’ revenues and income from operations fared well through the pandemic and beyond. At the same time, Audio Providers (radio companies) and Out-of-Home Companies turned in the weakest performance between 2019 and 2023.
  3. Despite a tough 2022, Digital Media Companies have seen their Total Enterprise Value nearly double between year-end 2019 and year-end 2023. Other companies that have seen growth in Total Enterprise Value between 2019 and 2023 are the News & Information sector.

We’ve written the report to be insightful and beneficial to professionals working in lending, private equity, M&A, and consulting/advisory capacities. Visit our shopping cart to purchase the report, Media Ecosystem Review.

For any valuation inquiries, please contact me at valuations@bia.com or lross@bia.com.

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