I am at $2.78 on my 1 year target. You can look at the EV/EBITDA analysis here.
http://messageboards.aol.com/aol/en_...Unhidden=false
I cited some of Tinker's aggressive projections on EBITDA growth in the analysis and assigned a 20 multiple.
I actually believe Spencer is a rather intelligent guy who really feels that the internet is the way to go for the radio business. I couldn't disagree with him more. I believe he has a fundamental misunderstanding about zero barrier to entry and how it destroys media business models. That's my opinion. Or he just is basically ignoring the fact as many do.
Make no mistake about it. Phone radio apps will suffer from the same fragmentation that happened to internet radio with PCs in the 90s. Pandora isn't making money with 80 million registered users and they are dominating the phone apps. What happens 5 years from now when there are 1 million radio stations available on smartphones as there on the internet at home today? Fragmentation. There is absolutely no barrier to entry.
In my opinion there are serious flaws in Spencer's thesis. I honestly believe if Mel followed Spencer's blog posts and put heavy emphasis on internet radio it would cause horrendous EBITDA margin problems. Thank goodness Mel has seemed to design a way to enhance and keep SAT RADIO subs with the internet business thus far. Internet radio is not a good business. As a churn reducer I think it could work. As an EBITDA growth business, it hasn't produced anything substantial in 17 years. If Spencer has the model that works I sure would love to see it. I think the whole industry is still searching for it.