Shares of iHeartMedia rose 13% in Tuesday trading after BofA Securities media analyst Jessica Reif Ehrlich posted a bullish report based on her positive outlook for radio and podcasting advertising in general and iHeart in particular.
Ehrlich raised her rating on iHeart to “buy” from “underperform,” and set a new target price of $26 on its shares -- up from $10, according to reports by Barron’s, Inside Radio and other outlets.
The stock’s $19.79 price at closing on Tuesday was its highest since iHeartMedia returned to public trading in July 2019.
Ehrlich forecast that advertising and sponsorships will “come roaring back over the next several months,” driven by the reopening of small- and medium-sized businesses and a revival of entertainment and live events.
iHeart’s digital business has remained robust due in large part to the continued growth of podcasting, and radio advertising will benefit from a rebound in drive time as pandemic stay-at-home dynamics subside, she wrote.
Drive time this month has more than doubled compared to April 2020, she noted.
iHeart has “manageable debt maturities” and should benefit in the first quarter from “healthy modernization initiative savings,” as well as advertising and digital growth, Ehrlich wrote.