Investment Thesis
iHeartMedia exhibits severe financial distress with negative stockholders' equity of -$1.8B, indicating technical insolvency where liabilities exceed assets. The company cannot service its $5.1B debt burden from operations, as evidenced by negative operating income (-$20.6M) and negative interest coverage (-0.2x), with near-zero net profitability (-12.2% margin). While operating cash flow remains positive at $92.6M, the absence of revenue growth and unsustainable debt levels create substantial bankruptcy or restructuring risk.
Strengths
- Operating cash flow remains positive at $92.6M despite accounting losses
- Current and quick ratios of 1.51x indicate manageable short-term liquidity
- EPS improved 54.2% YoY, suggesting cost controls or one-time items being normalized
Risks
- Negative stockholders' equity of -$1.8B indicates technical insolvency and balance sheet impairment
- Cannot service debt from operations: negative interest coverage of -0.2x with operating income of -$20.6M
- No revenue growth (0% YoY) in declining radio broadcasting industry with structural headwinds
- Debt-to-assets ratio of effectively 100% with only $270.9M cash against $5.1B long-term debt
- Significant bankruptcy and debt restructuring risk without operational turnaround
Key Metrics to Watch
- Operating income trend and path to profitability
- Operating cash flow sustainability and working capital requirements
- Debt refinancing ability and maturity schedule
- Revenue stabilization and margin improvement initiatives
Financial Metrics
Revenue
3.9B
Net Income
-472.9M
EPS (Diluted)
$-3.06
Free Cash Flow
10.9M
Total Assets
5.1B
Cash
270.9M
Profitability Ratios
Gross Margin
N/A
Operating Margin
-0.5%
Net Margin
-12.2%
ROE
N/A
ROA
-9.2%
FCF Margin
0.3%
Balance Sheet & Liquidity
Current Ratio
1.51x
Quick Ratio
1.51x
Debt/Equity
N/A
Debt/Assets
0.0%
Interest Coverage
-0.18x
Long-term Debt
5.1B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-04-11T16:42:21.389404 |
Data as of: 2025-12-31 |
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